TO THE FIRST INFORMATIONAL
HEARING OF THE SELECT COMMITTEE
ON IMPACT INVESTING- TODAY WERE
JOINED BY ASSEMBLY BANKING
COMMITTEE- MEMBERS TO DISCUSS
AN OVERVIEW OF IMPACT INVESTING
IN ITS POTENTIAL ROLE IN
HELPING US MEET OUR CLIMATE
GOALS AND SOCIAL JUSTICE JOB
GOALS HERE IN CALIFORNIA. WE
SEEK TO PROTECT THE RIGHTS OF
ALL WHO PARTICIPATE IN THE
LEGISLATIVE PROCESS SO THAT WE
COULD HAVE AFFECTED
DELIBERATIONS AND DECISIONS ON
ALL THE CRITICAL ISSUES FACING
CALIFORNIA. THAT'S WHY ALL
COMMITTEE CHAIRS READ THE
FOLLOWING COMMENTS AT THE START
OF EVERY COMMITTEE MEETING. DUE
TO THE COVERED PANDEMIC WE HAVE
LIMITED SPACE FOR THE PUBLIC TO
PARTICIPATE SO WE CAN ENSURE
EVERYONE MAINTAIN SIX FEET OF
SOCIAL DISTANCE. AS WE PROCEED
WITH PUBLIC COMMENTS TOWARDS
THE END OF THE HEARING I WANT
TO MAKE SURE EVERYONE
UNDERSTANDS IT ASSEMBLY HAS
RULES TO ENSURE WE MAINTAIN
ORDER AND RUN AN EFFICIENT AND
FAIR HEARING. WE APPLYTHESE
RULES TO ALL PEOPLE WHO
PARTICIPATE IN OUR PROCEEDINGS
IN ADDITION THIS YEAR WE WILL
AGAIN BE COMPLYING WITH ALL
PUBLIC HEALTH ORDERS ARISING.
OUT OF THE COVERT NINETEEN
PANDEMIC IN ORDER TO FACILITATE
THE GOAL OF HEARING AS MUCH
FROM THE PUBLIC WITHIN THE
LIMITS OF OUR TIME. WILL NOT
PERMIT CONDUCT THAT DISRUPTS
DISTURBS OR OTHERWISE IN PEACHY
ORDERLY CONDUCT OF LEGISLATIVE
PROCEEDINGS. WE WILL NOT ACCEPT
DISRUPTIVE BEHAVIOR BEHAVIOR
THAT INCITES OR THREATENS
VIOLENCE EVEN VEILED THREATS IF
YOU CAME INTO THE HEARING ROOM
TODAY THE SERGEANTS DIRECTED
YOUR ATTENTION TO THE RULES FOR
PUBLIC ATTENDANCE AND
PARTICIPATION. WHICH WERE
POSTED OUTSIDE THE DOOR. THE
RULES FOR TODAY'S HEARINGS
INCLUDE WEARING A MASK OVER
YOUR MOUTH AND NOSE AT ALL
TIMES. COMPLYING WITH THE
FISCAL PHYSICAL DISTANCING NO
TALKING OR LOUD NOISES FROM THE
AUDIENCE PUBLIC COMMENT MAY BE
PROVIDED ONLY AT THE DESIGNATED
TIME AND PLACE OF PERMITTED BY
THE CHAIR. PUBLIC COMMENT MUST
RELATE TO THE ISSUE BEING
DISCUSSED NO ENGAGING IN
CONDUCT THAT DISRUPTS DISTURBS
OR OTHERWISE AND PC ORDERLY
CONDUCT OF THIS YEAR. PLEASE BE
AWARE THE VIOLATIONS OF THESE
RULES MAY SUBJECT YOU TO
REMOVAL OR OTHER ENFORCEMENT
PROCESS. IF YOU'RE UNABLE TO
GET THROUGH ON THE PHONE PLEASE
FEEL FREE TO SUBMIT WRITTEN
TESTIMONY THROUGH THE PORTAL ON
THE ASSEMBLY BANKING AND
FINANCE COMMITTEE WEBSITE. FOR
THOSE WHO ARE WATCHING THIS
HEARING REMOTELY AND WHO WISH
TO CALL IN TO REGISTER THEIR
POSITION THE CALL IN NUMBER FOR
THIS HEARING IS. EIGHT SEVEN
SEVEN SIX NINE TWO EIGHT NINE
FIVE SEVEN. THAT'S.
877-692-8957 AND THE ACCESS
CODE IS TWENTY FOUR TWENTY SIX.
TWO THREE SEVEN THAT'S TWENTY
FOUR TWENTY SIX TWO THREE
SEVEN. YOU CAN ALSO FIND THIS
NUMBER ON THE ASSEMBLY SELECT
COMMITTEE'S WEBSITE AS WELL AS
ON YOUR TV OR COMPUTER SCREEN.
IF YOU'RE CALLING IN PLEASE
ELIMINATE ALL BACKGROUND NOISE
THIS INCLUDES MU YOUR LIFE
STREAM BROADCAST. AND YOUR
SMART DEVICES TO REDUCE THE
SOUND DISTORTION. IF YOU'RE
HAVING ANY PROBLEMS WITH THE
MODERATE PHONE SERVICE YOU CAN
CALL MY OFFICE. NINE ONE SIX
THREE ONE NINE TWO OH THREE
SEVEN THAT'S NINE ONE SIX THREE
ONE NINE TWO OH THREE SEVEN.
AND MY STAFF WILL BE THERE TO
TRY TO HELP. THANK YOU FOR
BEARING WITH US AS WE HAVE WITH
THAT MESSAGE TO CONTINUE TO
SERVE THE PEOPLE OF CALIFORNIA.
WHILE ALSO BEING MINDFUL
RESPECTFUL THE PUBLIC HEALTH
CONCERNS WE FACE. WITH ALL
THOSE ANNOUNCEMENTS ALL THE WAY
WILL NOW MOVE ON TO THE
COMMITTEE'S. AGENDA IMPACT
INVESTING HAS BEEN AN ISSUE AN
INTEREST OF MINE FOR THE LAST
FEW YEARS. WE FACE TWO
SIGNIFICANT PROBLEMS THAT
REQUIRE THE BEST FROM ALL OF US
IF WE'RE TO PROPERLY ADDRESS
THEM. OUR MODERN COMPLEX WORLD
IS LEAVING TOO MANY PEOPLE IN
DISADVANTAGED SITUATIONS. AND
THE WINDOW TO DO IMPORTANT
THINGS CLIMATE CHANGE IS
CLOSING RAPIDLY. BOTH PROBLEMS
CRY OUT FOR CREATIVE SOLUTIONS.
AND THE CONCERTED EFFORTS. FROM
OUR MOST TALENTED LEADERS IN
THE FIELDS OF BUSINESS
GOVERNMENT AT ALL LEVELS OF NON
PROFITS. IMPACT INVESTING IS AN
IMPORTANT AND RELATIVELY NEW
APPROACH TO HARNESSING THIS
ENERGY AND TALENT. WE'RE HERE
TODAY TO LEARN MORE ABOUT
IMPACT INVESTING FROM ONE OF
THE GLOBAL LEADERS OF THIS
EFFORT. RICHARD DREW. ARE
FUNDAMENTAL QUESTIONS ARE
THESE. AS CALIFORNIA
LEGISLATORS WHAT DO WE NEED TO
KNOW ABOUT IMPACT INVESTING.
AND WHAT OUR POTENTIAL
EFFECTIVE LEGISLATIVE ACTIONS
WE COULD TAKE TO ENCOURAGE IT
AND CALIFORNIA. I'D LIKE TO NOW
TURN THE MICROPHONE OVER TO
ASSEMBLY MEMBER GRAYSON WHO
SHOULD CHAIR OF THE BANKING AND
FINANCE COMMITTEE. FOR HIS
OPENING REMARKS MR GRAYSON.
THANK YOU SO MUCH AND I DO WANT
TO THANK THE CHAIR OF THE
SELECT COMMITTEE FOR INVITING
MEMBERS OF THE BANKING
COMMITTEE TO TODAY'S HEARING. I
THINK THE DISCUSSION WILL BE
TREMENDOUSLY HELPFUL. AS CHAIR
THE BANKING COMMITTEE I BELIEVE
THAT THE FINANCIAL SERVICES.
SERVICES INDUSTRY MUST PLAY A
HELPFUL AND CONSTRUCTIVE ROLE
IN A DRESSING SOME OF THE
BIGGEST CHALLENGES IN OUR
SOCIETY SUCH AS ANY QUALITY.
STRUCTURAL RACISM AND EVEN
CLIMATE CHANGE. IMPACT
INVESTING IS ONE POSSIBLE
SOLUTION AND I'M EAGER TO LEARN
MORE FROM OUR SPEAKER TODAY
ABOUT ITS POTENTIAL- TOO.
MEANINGFUL SUPPORT- THE- FOR
THESE LONG TERM SOCIAL AND
ENVIRONMENTAL GOALS. THANK YOU
THANK YOU VERY MUCH AND WE
APPRECIATE YOUR YOU JOINING US
TODAY IN ADDITION TO- BANKING
COMMITTEE CHAIR- I WE REALLY
APPRECIATE JOINING US ALSO-
THIS IS THE CHAIR OF- ASSEMBLY
REVENUE ATTACKS ASSEMBLY MEMBER
BURKE- ASSEMBLY MEMBER STONE
WHO IS THE CHAIR OF THE
ASSEMBLY JUDICIARY COMMITTEE-
SENATOR ALAN THE CHAIR OF THE
SENATE ENVIRONMENTAL POLICY
COMMITTEE ASSEMBLY MEMBER
PETRIE-NORRIS CHAIR OF
ACCOUNTABILITY AND
ADMINISTRATIVE REVIEW COMMITTEE
SENATOR LIMóN CHAIR OF THE
SENATE BANKING FINANCIAL
INSTITUTION COMMITTEE SENATOR
MAN AND SENATOR STERN. WE ALSO
HAVE A VARIETY OF ORGANIZATIONS
THAT HAVE INFORMED US THAT THEY
ARE- OBSERVING THIS HEARING AND
THAT'S THE SIERRA CLUB OF
CALIFORNIA CALIFORNIA CHAMBERS
OF COMMERCE CALIFORNIA BANKERS
ASSOCIATION CALIFORNIANS
AGAINST WASTE THE SILICON
VALLEY LEADERSHIP GROUP TESLA
AND MANY OTHERS AND WITH THAT-
WE REALLY APPRECIATE MRS DREW.
OF BEING HERE AND- HI
APPRECIATE FINDING BY.
CONSTITUTION MRS THROUGH THEIR
AGO ALL RIGHT THANK YOU. BOB
SHOW OF BEFORE I INTRODUCED MRS
TRUE THOUGH ARE THERE ANY
MEMBERS HERE TODAY WHO WOULD
LIKE TO MAKE COMMENTS IT'S A
START. ASSEMBLY MEMBER R. B. K.
THANK YOU MISTER CHAIR AND I
JUST WANT TO SAY THANK YOU FOR
SETTING UP THIS HEARING IN
STARTING THIS CONVERSATION I
WANNA THINK MYSTERY FOR BEING
HERE I. HAVE THE OPPORTUNITY TO
REVIEW THE INTERVIEW YOU SENT
OUT PRIOR AND READ THE
MATERIALS AND I THINK THIS IS A
REALLY IMPORTANT CONVERSATION
AS WE START TO LOOK AT HOW WE
ACHIEVE OUR- INCREDIBLE CLIMATE
GOALS OF HIM SAID AS A STATE.
WE HAVE TO BE USING EVERY TOOL
IN OUR TOOLBOX AND I THINK THIS
IS A REALLY CRITICAL ONE AND
LISTENING TO MISTRUTH SPEAK IN
THE INTERVIEW ABOUT ALSO HOW
RESILIENT THESE FUNDS WERE
DURING THE DOWNTURN WAS REALLY
AN INCREDIBLE THING TO LEARN
ABOUT. AND I HOPE WE'LL DISCUSS
THAT MORE TODAY BECAUSE AS
CALIFORNIA WE ARE HUGE INVESTOR
AND SO HOW DO WE USE OUR OWN
RESOURCES TO ENSURE THAT WERE
BOTH BEING RESILIENT IN TIMES
OF A DOWNTURN AS WELL AS USING
OUR MONEY TO MOVE. THE BALL
FORWARD IN THE AREAS WE CARE SO
DEEPLY ABOUT THANK YOU THANK
YOU VERY MUCH DO WE HAVE OTHER
MEMBERS AS SHE- ASSEMBLY MEMBER
PETER NORRIS ARE YOU. DID YOUR
DID YOUR SCREEN OPEN UP BECAUSE
YOU WANNA MAKE A COMMENT OR
YOU'RE JUST PARTICIPATING
VIRTUALLY. LOOKS LIKE SHE'S
PARTICIPATING. I AM
PARTICIPATING VIRTUALLY THANK
YOU SO MUCH ASSEMBLY MEMBER
BENEFITS AND THAT THANK YOU SO
MUCH MYSTERY FOR JOINING US I
REALLY APPRECIATE YOUR
LEADERSHIP ASSEMBLY MEMBER
BENNETT AND I CONVENE THE
SELECT COMMITTEE ON IMPACT
INVESTING GRATEFUL TO BE PART
OF IT- TO BE PART OF THIS
CONVERSATION AND- I THINK THAT
THERE'S AN OPPORTUNITY REALLY
IN PHILLY FOR US TO FIND SEVEN
INNOVATIVE AND- GROUND BREAKING
WAYS FOR US IS POLICYMAKERS I'M
TO. SUPPORT HIGH IMPACT
INVESTING HERE IN THE STATE OF
CALIFORNIA- AND HAVE SOME
TRANSFORMATIONAL DAYS SEVEN
LOOKING FOR TODAY'S TODAY'S
HEARING AND TO INITIATING THIS
IMPORTANT CONVERSATION. THANK
YOU VERY MUCH AND THE OTHER
MEMBERS. SO NOW IT'S A REAL
PLEASURE FOR ME- TO INTRODUCED-
OUR SPEAKER RICHARD DREW SHE'S
A CEO OF IMPACTED- ADVISORY AND
FINANCE CHIEF SUSTAINABILITY
OFFICER AND GLOBAL HEAD OF
SUSTAINABILITY STRATEGY
ADVISORY AND FINANCE AT CREDIT
SUISSE BANK. IN THIS CAPACITY
MS DREW IS RESPONSIBLE FOR
SETTING THE STRATEGY AND
DIRECTING COORDINATING AND
FACILITATING ACTIVITIES ACROSS
THE BANK WHICH LEAD TO IMPACT
INVESTING ON BEHALF OF THE
BANKS PRIVATE WEALTH
INSTITUTIONAL AND CORPORATE
CLIENTS. MISTER WAS RECOGNIZED
BY THE BBC IS ONE OF THE MOST
POWERFUL WOMEN IN BRITAIN AND
BY FORTUNE MAGAZINE AS ONE OF
THE FIFTY MOST POWERFUL WOMEN
IN INTERNATIONAL BUSINESS. MS
DREW RECEIVED A BA IN FINANCE
AND MARKETING WITH DISTINCTION
FROM THE UNIVERSITY OF
VIRGINIA'S MCINTIRE SCHOOL OF
COMMERCE AN MBA WITH
DISTINCTION FROM THE WHARTON
SCHOOL AND SHE JOINS US FROM
HER HOME IN CONNECTICUT THIS
AFTERNOON. MISTRUTH ACTUALLY
THIS EVENING FOR YOU AND WE
REALLY APPRECIATE YOU MAKING
THE EFFORT DECEIVING- ON YOUR-
NON WORKING HOURS TO JOIN US
MR. TO MR WELCOME TO THE
COMMITTEE AND THANK YOU FOR
TAKING THE TIME OUT OF YOUR
BUSY SCHEDULE AND YOUR EVENING
ASKED TO SPEND TIME WITH US
TODAY. THANK YOU ASSEMBLY MEN
THAT AND- THOSE OF YOU WHO ARE
PARTICIPATING TODAY SESSION
THAT'S MY ABSOLUTE PLEASURE TO
BE HERE. SO YOU WOULD ASK ME- A
LITTLE BIT I GUESS IS AS AN
OPENING QUESTION ABOUT THE
FIELD OF SUSTAINABLE FINANCE
AND WHERE THIS IS ALL HEADED
SO- MAYBE I WILL START THERE.
IN TERMS OF A LITTLE BIT OF
LEVEL SETTING AND SOME
TERMINOLOGY JUST SO THAT- WE'RE
ALL SPEAKING SO TO SPEAK FROM
THE SAME HYMN SHEET. ON THE SO
FIRST OF ALL WHEN WE TALK ABOUT
THE FIELD OF SUSTAINABLE
FINANCE AND SOMETIMES I THINK
THAT THIS IS- IT'S MORE
COMPLICATED THAN IT NEEDS TO BE
THE WAY WE THINK ABOUT THIS
DEFINITION ONLY. IS- A REALLY
SUSTAINABLE FINANCES A TOOL
THROUGH WHICH INVESTORS CAN
BOTH MITIGATE RISK AND IDENTIFY
OPPORTUNITIES AND THAT IS BY
LOOKING AT THE S. N. G. FACTOR
SO ENVIRONMENTAL SOCIAL AND
GOVERNANCE FACTORS. IN
INCORPORATE THOSE INTO
INVESTMENT STRATEGIES ALONGSIDE
TRADITIONAL FINANCIAL METRICS
SO THE IMPORTANT THING TO NOTE
HERE IS WHAT WE'RE TALKING
ABOUT SUSTAINABLE FINANCE THIS
IS RETURNS BASED INVESTING SO
THOSE WHO ARE PARTICIPATING ARE
EXPECTING TO GENERATE A RETURN.
AND I WOULD SAY FOR THE VAST
PREPONDERANCE OF SUSTAINABLE
INVESTORS THEY'RE SEEKING TO
GENERATE A MARKET RATE OF
RETURN FOR BETTER FROM THESE
INVESTMENT SO- THE VAST
MAJORITY OF THOSE PARTICIPATING
IN THE SPACE ARE NOT LOOKING AT
CONCESSIONARY RETURN AND I
THINK THAT'S REALLY IMPORTANT
BECAUSE- I THINK THERE'S A BIT
OF A MISNOMER. THAT WHEN YOU
GET INTO THE FIELD IMPACT
INVESTING OR SOMETHING THAT IS
TRYING TO ACHIEVE POSITIVE
SOCIAL ENVIRONMENTAL OUTCOMES
WITH CAPITAL THAT COMES AT A
COST. AND WE WOULD ACTUALLY
MAKE A DIFFERENT ARGUMENT THAT
IN MOST CASES ON A RISK
ADJUSTED BASIS YOU CAN GENERATE
OUTSIZE RETURNS BY TAKING THESE
FACTORS INTO CONSIDERATION. SO
WITH THAT AS A BACKDROP AND IF
I THINK ABOUT THE SPECTRUM OF
FINANCE ON THE ONE HAND IF YOU
THINK OF A GRID OR SPECTRUM. ON
FAR LEFT WE THINK ABOUT
TRADITIONAL FINANCIAL
INSTRUMENTS AND ALL THOSE DO IS
SEEK TO GENERATE A RISK
ADJUSTED RETURNS. AND THEY ASK.
NOTHING MORE OF THAT INVESTMENT
THE TO GENERATE THAT WERE. AND
THEN WE MOVE INTO THE FIELDS
STAND OFF I. WHAT WE'RE TRYING
TO IS TO EITHER CREATE. ALIGNED
INVESTMENT FOR TO DRIVE
OUTCOMES. SO THE UMBRELLA
TERMINOLOGY THAT MOST PEOPLE
USES ESG INVESTING WHEN THEY
TALK ABOUT SUSTAINABLE
INVESTING. BUT THAT'S JUST A
STARTING POINT AND WE WOULD SAY
THAT THAT IS REALLY JUST GOOD
HYGIENE. SO LOOKING
ENVIRONMENTAL SOCIAL AND
GOVERNANCE CHARACTERISTICS IN
YOUR INVESTMENTS. LEADS YOU TO
A PLACE WHERE YOU THEN CAN
DECIDE WHETHER YOU'RE TRYING TO
DRIVE REAL IMPACT. AND WE START
TYPICALLY WITH EXCLUSIONS
THAT'S THE SIMPLE PLACE TO GO.
WHEREINVESTORS SAY I DO NOT
WANT TO HAVE. ANY EXPOSURE TO
CERTAIN THINGS IN MY PORTFOLIO
THAT COULD BE WEAPONS THAT
COULD BE TOBACCO COULD BE
FOSSIL FUELS WE CALL THAT
EXCLUSIONS. AND WE MOVED FROM
EXPLOSIONS. FURTHER TO THE
RIGHT AND WE TALK ABOUT ESG
INTEGRATION WHERE WE'RE
THINKING ABOUT THOSE ESG
FACTORS IN OUR PORTFOLIOS IN A
MORE DELIBERATE WAY. AND
THINKING ABOUT WHERE RISK MIGHT
BE IDENTIFIED- OPPORTUNITIES
pWE MOVE FURTHER TO THE RIGHT
AND NOW WE'RE MOVING INTO THE
WORLD OF IMPACT INVESTING. THIS
IS A VERY DELIBERATE SPACE SO
INVESTORS WITHIN IMPACTS ARE
SAYING I WANT TO ACHIEVE
CERTAIN ENVIRONMENTAL OR SOCIAL
OUTCOMES. AND I'M PREPARED TO
MEASURE MYSELF AND HOLD MYSELF
ACCOUNTABLE FOR THE DELIVERY OF
THOSE OUTCOMES AS WELL AS A
FINANCIAL RETURN. SO WE SAY THE
TENETS OF IMPACT INVESTING. OR
INTENTIONALITY. MEASURE ABILITY
OF IMPACT. AND REPORTING AND
HOLDING YOURSELF ACCOUNTABLE TO
THE IMPACT. AND ALL BREAK
IMPACT INVESTING DOWN THEN
FURTHER INTO TWO CATEGORIES ONE
WE CALL RETURNS FIRST AND THIS
IS WHERE WE'RE FOCUSING ON
MARKET RATE OF RETURN OR BETTER
FORGET AN ASSET CLASS. AND THEN
THERE'S THE IMPACT FIRST WHERE
WE'RE FOCUSED ON DELIVERING A
CERTAIN IMPACT AND BE PREPARED
TO TAKE CONCESSIONARY RETURNS.
BECAUSE THE CAPITAL. NEEDS TO
BE CATALYTIC. AND I THE ALL OF
THESE ARE. IN MAKING HOW. A
STATE PURCHASE IN THE SPACE TO
OUT. BUT THEN FINALLY AS WE
MOVE FARTHER TO THE RIGHT WE
MOVE INTO THE WORLD OF
PHILANTHROPY- AND THAT IS WHERE
YOU ARE GIVING MONEY AWAY AND
NOT ASKING FOR ANYTHING IN
RETURN. AND ACROSS THE ENTIRE
SPECTRUM FROM EXCLUSIONS
THROUGH DELIBERATE IMPACT
THERE'S A PLACE FOR EVERYBODY
AND A COMBINATION IN DIVERSE
PORTFOLIOS IN OUR OPINION. THAT
STILL CAN A LINE WITH VALUES
INVESTING AND I CAN STILL DRIVE
OUTCOMES SO CONTEXTUALLY MAYBE
I CAN JUST GIVE YOU A FLAVOR
FOR THE SIZE OF THE OVERALL
MARKET. SO THE OVERALL UMBRELLA
OF SUSTAINABLE INVESTING- OUR
EXPECTATION WHEN THE NEW
STATISTICS ARE GOING TO COME
OUT WHICH WOULD BE VERY
SHORTLY. BUT IT WILL BE ABOUT
EIGHT FIFTY TRILLION DOLLAR
MARKET SO THAT'S CAPITAL
INVESTED IN SUSTAINABLE
STRATEGIES ACROSS THE BOARD SO
FIFTY TRILLION. AND THE GROWTH
RATE HAS BEEN NORTH OF A
HUNDRED AND 75% ANNUALLY FOR
EACH OF THE PAST FOUR TO FIVE
YEARS SO EXTRAORDINARY ORGANIC
GROWTH IN THIS MARKET. AND THAT
REPRESENTS ABOUT A THIRD OF THE
OVERALL FINANCIAL MARKETS. IN
TERMS OF ANNUAL INVESTMENTS.
OUR OF THAT IMPACTED. IS A VERY
SMALL SUBSET TODAY THAT'S ABOUT
A TRILLION DOLLAR MARKET.
VERSUS THE FIFTY TRILLION
OVERALL BUT ITS GROWTH RATE IS
NORTH OF A 1000% SO COMING FROM
A SMALL BASE BUT GROWING
EXPONENTIALLY. AND WHY IS THAT
WHY IS THAT HAPPENING IT'S
BECAUSE I THINK IMPACT
INVESTING IS CAPTURING THE
HEARTS AND MINDS OF THE
INVESTMENT COMMUNITY BECAUSE
YOU CAN MEASURE OUTCOMES. AND
THIS IS WHAT'S CAPTIVATING
PEOPLE IF YOU CAN GENERATE A
RETURN. THAT'S A MARKET RATE OR
BETTER. AND YOU CAN ACHIEVE AN
OUTCOME THAT'S MEASURABLE
THAT'S CAUSING A POSITIVE
OUTCOME ON THE ENVIRONMENT ARE
ON SOCIETAL ISSUES WHAT'S NOT
TO LIKE ABOUT THAT IT'S SORT OF
THE- DOUBLE OR SOMETIMES PEOPLE
CALL THE TRIPLE BOTTOM LINE SO
WIN WIN FOR EVERYBODY. AND
THOSE WHO ARE PARTICIPATING IN
THIS SPACE IT IS THE ENTIRE
FINANCIAL SYSTEM. WE SEE
INSTITUTIONAL INVESTORS AT
SCALE GETTING INVOLVED IN
IMPACT. WE SEE SOVEREIGN WEALTH
FUNDS. PENSION FUNDS INSURANCE
COMPANIES AND THE LIKE SO IT'S
REALLY VERY VERY DEEP AND BROAD
BASED. AGAIN THE LARGEST
COMPONENT THAT IS A STABLE
INVESTING STRATEGIES BUT THIS
IMPACT SPACE IS INCREASINGLY
SOMETHING. WHERE INVESTORS ARE
GETTING VERY EXCITED. ONE SMALL
EXAMPLE OF THE SOVEREIGN WEALTH
SIDE. IS THAT THIS YEAR OUT OF
THAT- CIRCA TRILLION MARKET
THAT WE JUST DISCUSSED. WE JUST
HAD ANNOUNCEMENT SEVERAL WEEKS
AGO THAT TOMASZ AND- THE ASIAN
SOVEREIGN WEALTH FUNDS. IS
PUTTING FIVE HUNDRED- FIVE
HUNDRED MILLION OF CAPITAL INTO
ONE IMPACT FUND MANAGER BECAUSE
THEY'RE TRYING TO DRIVE SOCIAL
OUTCOMES AND THEY WANT TO BE
SUPPORTIVE OF THOSE OUTCOMES.
THIS IS AN EXAMPLE OF THIS SIZE
BONTA ON THAT WE'RE SEEING. SO
OUR EVERY EXPECTATION IS THAT
THESE GROWTH RATES WILL
CONTINUE. AND WE BELIEVE THAT'S
THE CASE BECAUSE ALL OF
FOUNDATIONS ARE THERE. WE SEE
REGULATORY INTERVENTION
POLICYMAKERS POLITICAL LEADERS
ALL WANTING TO ADDRESS BIG
SOCIETAL. ISSUES LIKE CLIMATE
CHANGE OR SOCIAL ENACT WHAT.
AND DOING WHAT THEY CAN BROUGH
AYE SAFELY WILL. IS GENERALLY
MANIFEST IN REGULAR. I WERE
SEEING REGULATE PROLIFERATE.
ACROSS THE PIECE TO TRY TO
DRIVE MORE CAPITAL GOING INTO
THE SPACE SO LET ME GIVE YOU AN
EXAMPLE I CAN SKIP AROUND THE
WORLD IF YOU LIKE TO TALK ABOUT
REGIONALLY WHERE WE'RE SEEING
ACTIVITY. BUT I HAVE TO POINT
PERSON FOR MOST OF THE E. U.
THE EUROPEAN UNION NATION
EXTRAORDINARY LEADERSHIP OF
TRYING TO PROMOTE SUSTAINABLE
INVESTING. SO MUCH SO THAT THE
EUROPEAN COMMISSION HAS PUT IN
PLACE REGULATIONS THAT CAME
INTO PLACE JUST IN IN MARCH OF
THIS YEAR. THAT SAYS THAT ANY
FINANCIAL INSTITUTION MONEY
MANAGER ASSET MANAGER BANK THAT
TOUCHES THE EUROPEAN UNION.
MUST NOW DEMONSTRATE THAT THEY
TAKE AN ENVIRONMENTAL SOCIAL
AND GOVERNANCE CHARACTERISTICS
INTO ACCOUNT IN ANY FINANCIAL
PRODUCT THAT WE CREATE. OR ANY
PIECE OF ADVICE THAT WE GIVE.
AND THEY'RE ASKING US TO
DEMONSTRATE THAT BY. PROVIDING
SPECIFIC COMMITMENTS AND THAT
IN ANY FINANCIAL DOCUMENTATION
PROSPECTUS IS WHAT HAVE YOU
WE'RE SHOWING THAT WE TAKING
THESE FACTORS INTO
CONSIDERATION. SO ANY VIRTUALLY
ANY GLOBAL INSTITUTION THAT
DOES ANY BUSINESS WHATSOEVER
AND YOU NOW HAVE TO DEMONSTRATE
THAT THROUGH THIS PIECE OF
REGULATION. WE'RE ALSO FACING
REGULATION IN THE FINANCIAL
SERVICES INDUSTRY- AROUND
DISCLOSURES THIS IS A VERY VERY
BIG TOPIC OF THE INVESTMENT
COMMUNITY BECAUSE INVESTORS
WANT MORE DISCLOSURE AROUND
SUSTAINABILITY FACTORS. IN
ORDER FOR THEM TO MAKE INFORMED
INVESTMENT DECISIONS. SO WHAT
STARTED AS A VOLUNTARY EFFORTS-
CHAMPION BY THE GREAT MIKE
BLOOMBERG ENDS AND MARK CARNEY
WHICH IS THE T. C. F. T. THE
TASK FORCE FOR CLIMATE RELATED
FINANCIAL DISCLOSURE. WHICH
TODAY IS VOLUNTARY WILL SOON
BECOME FOR ITS ALREADY EVERY
EXPECTATION THAT WE WILL BE
HELD ACCOUNTABLE AS FINANCIAL
INSTITUTIONS. FOR DISCLOSING
OUR EXPOSURE TO CLIMATE.
RELATED ISSUES BOTH INTO ARMS
OF RISK BUT I OPPORTUNITY.
WHERE WE CAN TRY- THIS. ISSUE
OF CLIMATE INTO OPPORTUNITIES
THAT WILL GIVE US A MORE
SUSTAINABLE BUSINESS I EAT IN
THE BANKING SYSTEM ARE WE
BANKING THE COMPANIES OF THE
FUTURE AND OUR COGNIZANT THAT
WE CONTINUE TO BANK COMPANIES.
WHO WILL ULTIMATELY LOSE EQUITY
VALUE AS OUR BUSINESSES GET
USURPED BY GREENER AND MORE
SUSTAINABLE ALTERNATIVES ARE WE
AWARE OF THOSE RISKS AND THOSE
EXPOSURES. SO T. C. F. T. NOT
ONLY SPEAKS TO FINANCIAL
INSTITUTIONS IT'S ALSO ASKED
CORPORATES TO GO THROUGH THE
SAME EXERCISE THINK ABOUT
DEEPLY THEIR BUSINESSES WHERE
THEY EXPOSED TO CLIMATE CHANGE
WHERE ARE THERE RISKS. HAVE
THEY DONE FINANCIAL MODELING
SCENARIO MODELING UNDER
DIFFERENT TEMPERATURE DEGREE
SCENARIOS. WHAT MIGHT THOSE
RISKS LOOK LIKE BUT ALSO WHERE
THIS COMPANY'S CHANGING AND
MIGRATING THEIR BUSINESSES TO
SEIZE THE OPPORTUNITY THAT'S
ASSOCIATED WITH CLIMATE CHANGE
AND THOSE OPPORTUNITIES ARE
ENORMOUS I MEAN. IF YOU EXAMPLE
AFTER EXAMPLE BUT A SLIP BUT
THAT I LIKE TO- SO OFTEN- GIVE.
IS IF YOU THINK ABOUT A COMPANY
LIKE CHINA A COUNTRY LIKE
CHINA. THAT IS NOW COMMITTED TO
NET. ZERO BY TWENTY FIFTY
TWENTY SIXTY- IN SO DOING THEIR
PROMOTING. ENTIRE INCLUDING
ENTIRE INDUSTRIES OVERNIGHT BY
SIMPLE STATEMENTS SO ONE BEING
THEY CAMEOUT NOT TOO LONG AGO
AND SAID THAT WITHIN A SHORT
PERIOD OF TIME THEY'RE GOING
TO. BAN ALL PETROL VEHICLES. SO
THE MINUTE CHINA SAID. IN AS
SHORT WINDOW OF TIME THEY'LL
BAN PETROL CARS WHAT HAVE THEY
DONE. THEY BASICALLY CREATED A
MULTI HUNDRED BILLION INDUSTRY
AND LECTER VEHICLES ANY
COMPONENT PARTS TO MANUFACTURE
ANY OEM MANUFACTURER ANY
ELECTRIC VEHICLE INFRASTRUCTURE
PROVIDER ALL OF THOSE COMPANIES
ARE GOING TO BENEFIT FROM THE
FACT THAT THE THREE HUNDRED
MILLION AT MIDDLE CLASS
CONSUMERS. THAT ALL STATE OWNED
CARS IN CHINA ARE GOING TO NEED
TO BUY ELECTRIC CARS SO THERE
IS THE OPPORTUNITY SET IF
YOU'RE AN INVESTOR OR IF YOUR
COMPANY IN THOSE INDUSTRIES OR
IF YOU'RE A COUNTRY THAT'S
TRYING TO PUSH. TOWARD A
GREENER SOLUTION BY PROMOTING
AND SUGGESTING THAT THOSE ARE
THE INDUSTRIES OF THE FUTURE
YOU CAN DRIVE OUTCOMES AND
THAT'S WHERE THIS WHOLE IMPACT
INVESTING MESHES WITH I THINK
POLITICAL AND REGULATORY
INTERVENTION. THE OTHER THING
THAT I WOULD POINT TO JUST IN
TERMS OF NOMENCLATURE AND LEVEL
SETTING IS ONE OF THE AREAS
WHERE I THINK- WE ARE STILL
CHALLENGED IF I'M HONEST AND
SUSTAINABILITY FIELD. IS THERE
IS NOT A COMMON DEFINITION FOR
WHAT IS IMPACT OR INDEED WAS
EVEN GROUP. AND A GOOD EXAMPLE-
WOULD BE AN ELECTRIC DID LETTER
VEHICLE INDUSTRY IF I LOOK AT
MY CONSTITUENTS MY STAKEHOLDERS
MANY OF MY INVESTORS. ABOUT
HALF OF THEM WILL SAY TODAY-
THEY PUT ELECTRIC VEHICLES IN
THEIR SUSTAINABLE INVESTING
BUCKET. BUT FULLY ANOTHER HALF
OF MY INVESTORS WILL SAY THAT'S
CORRECT WE'RE DRIVING TO A
GREAT OUTCOME WITH THE HEAT.
BUT TODAY WE'RE STILL RELIANT
ON IMPORTS WHICH ARE DRIVEN
FROM NON SUSTAINABLE PRACTICES
SO BATTERY TECHNOLOGY IS STILL
RELIANT ON BASE METALS MINING
COBALT AND WHAT HAVE YOU. AND
OFTENTIMES THOSE MINES ARE
HIGHLY POLLUTING OR THEY'RE NOT
SUSTAINABLE IN THE LABOR
PRACTICES SO SOME OF THE
INVESTORS WHO WANT TO GO MANY
LEVELS DEEPER. DON'T YET PUT
EVEY INTO THEIR SUSTAINABLE
BUCKETS SO THIS MISMATCH OF
DEFINITIONS IS SOMETHING THAT
WE NEED TO I THINK COME TO SOME
COMMON. AGREEMENT AROUND WHAT
IS REALLY GREEN WHAT IS GREEN
UP JACK WHAT IS TRENDS. AND
THERE'S A LOT OF WORKING DONE
IN THAT FIELD. BUT AND THE E.
U. IS AGAIN SHOWING LEADERSHIP
THERE WITH THE U. TAXONOMY THE
GREEN TAXONOMY THEY WANT TO
CREATE THOSE DEFINITIONS SO
THAT WE CAN ALL BE SPEAKING
ABOUT THE SAME THING WE TALK
ABOUT INVESTING. IN A GREEN
ALTERNATIVE- GREEN VESTMENT.
THE OTHER AREA IN TERMS OF THE
NOMENCLATURE THAT I THINK IS
IMPORTANT TO UNDERSTAND. IS THE
IMPORTANCE OF THE UN
SUSTAINABLE DEVELOPMENT GOALS
AFFECTIONATELY KNOWN AS THE
ESTEY JEEZ. WHAT THE U. ENDED
IN TWENTY SIXTEEN WAS TO TRY TO
CATEGORIZE THE WORLD'S BIGGEST
ENVIRONMENTAL AND SOCIAL
CHALLENGES. INTO SEVENTEEN
CATEGORIES. AND BY DOING THAT.
THEY ALLOW THE INVESTMENT
COMMUNITY AND THE BROADER
COMMUNITY AT LARGE TO IDENTIFY
WITH THOSE AREAS THAT SPOKE TO
THEM MOST. SO SDG FIVE SEVEN
AND NINE THAT COULD BE GENDER
EQUALITY ACCESS TO EDUCATION. I
ENDING POVERTY- CLARINET- GREEN
ENERGY- SMART CITIES AND GRAY
AND GREEN AND AFFORDABLE- AND-
EDUCATION CITIES. SO I WOULD
HIGHLY RECOMMEND THAT IS YOU'RE
THINKING ABOUT THIS TOPIC. THAT
YOU THINK ABOUT WHERE THE STATE
MINUS ONE MIGHT WANT TO BE
DRIVING OUTCOMES IN SPECIFIC
CATEGORIES THAT WILL ALIGN
THEMSELVES TO THE SDGS BECAUSE
THAT'S THE LANGUAGE THAT THE
FINANCIAL COMMUNITY. AND THE
INVESTMENT COMMUNITY BROADLY ON
THE CORPORATE MEDIA ARE USING
TO TRY TO CATEGORIZE THE PLACES
WHERE THEY WANT. TO PARTICIPATE
AND DRIVE THOSE OUTCOMES- I
GUESS- I HOPEFULLY SETTING A
BIT IS BUT I US TO IN A BECAUSE
I THINK THE GOING TO BE MOST
PART FOR ALL OF YOU- I THINK I
WILL MAYBE TURN TO THE NEXT
QUESTION THAT WAS POSED TO ME
BY SOMEONE THAT WHICH IS WHERE
HAS THE LEGISLATURE GET
INVOLVED AND TRY TO DRIVE. SOME
OF THESE OUTCOMES. WELL ONE OF
THE BIG AREAS I THINK- THAT IS
WORTH THINKING ABOUT. IS THE
CAPITAL RAISING ARENA. AS A
STATE. SO ONE OF THE CATEGORIES
OF THIS OVERALL SUSTAINABLE
INVESTMENTS. IS THE DEBT PUBLIC
DEBT CAPITAL MARKETS SO THE
GREEN BOND MARKETS IN THE
SUSTAINABLE BOND MARKETS WHICH
HAVE AN EQUAL- A GROWTH RATE
AND TRAJECTORY THAT WE'RE
SEEING IN TERMS OF MARKET
APPETITE AND ENTHUSIASM. LAST
YEAR WE HAD. ALL NEW RECORD
VOLUMES OF ABOUT SEVEN HUNDRED
AND BILLION. IN THE GREEN AND
SUSTAINABLE BONTA. AND THIS IS
WHERE AND ISSUER IS SIX IN THE
MARK. WHERE THEY ARE AGREE.
THAT THE USE OF THAT INSURANCE
WILL BE INVEST. IN GREEN OR
SOCIAL ALKA. THAT IS- NOW A TEN
YEAR LD MARKET. THAT IS-
WHETHER YOU'RE A CORPORATE
SOVEREIGN MUNICIPALITIES AND
THEIR AVAILING THEMSELVES OF
THIS MARKET IN ORDER TO RAISE
CAPITAL FOR VERY DELIBERATE
OUTCOMES. AND I CAN TELL YOU
THAT THE INVESTMENT COMMUNITY
IS. ABSOLUTELY FOCUSED ON
TRYING TO PUT MONEY TO WORK IN
THE STRATEGIES EST STRATEGIES
AND WHAT WE'RE SEEING IS ALL OF
THE ISSUES THAT COME TO MARKET
IN THIS GREEN AND
SUSTAINABILITY SPACE. ARE
SEEING ENORMOUS TAKE UP FROM
THE INVESTMENT COMMUNITY-
VIRTUALLY EVERY GREEN BOND THAT
WE'RE BRINGING TO MARKET IS
MULTIPLE TIMES OVER SUBSCRIBED
AND WHAT THAT HAPPENED WHAT
HAPPENS AS A BY PRODUCT OF THAT
IN TERMS OF SUPPLY AND DEMAND
EQUATION. IS THAT WITH ALL THAT
ENTHUSIASM FROM DESPERATELY
NEEDS THAT DRIVE DOWN COST OF
CAPITAL SO IT'S ALSO A VERY
EFFICIENT PLACE TO RAISE
CAPITAL TO INVEST IN THESE
THESE OUTCOMES. AND WHAT'S
INTERESTING IS COAST COE THAT
WERE DURING THIS YOU KNOW- CODE
pYEAR. WE HAVE SEEN THE S.
REALLY COME INTO THE FOR. THERE
WAS NOT EVEN SUCH A THING AS
THIS IS A SOCIAL BONDS TWO
THREE YEARS AGO AND LAST YEAR
THAT WAS ABOUT THE SEVENTY
BILLION DOLLARS PART OF THIS
OVERALL SEVEN HUNDRED FIFTY
BILLION MARKET. SO BURSTING
ONTO THE SCENE WITH THE
INVESTMENT COMMUNITY SAYING
THEY REALLY WANT TO PUT CAPITAL
TO WORK INTO TRYING TO SOLVE
SOME OF THESE INEQUITIES THAT
WERE SURFACED BY HOPE THAT. SO
THAT'S ANOTHER PLACE WHERE THE
STATE LEGISLATURE. CAN THINK
ABOUT NOT ONLY ADDRESSING
CLIMATE AND HE IS. BUT ALSO
THINKING ABOUT OF THOSE SO
ISSUE THAT WERE ARE TO. JUST IN
THE OPENING. SO LET COULD BE AN
ISSUE ARE OF ITS OWN GREEN
SOCIAL BY- THE OTHER THING.
THAT THINK YOU CAN DO WITH.
INTERNET IS TO KEEP NOT OR AND
SEND. TO THE- COMMUNITY. WHICH
WILL DRIVE HOW. IN THOSE
DROUGHT AND THOSE OUT. ONE OF
THE THINGS THAT I CAN POINT TO
AND- THAT'S A HUGE SIX. IS TAX
EQUITY IN. FIRST AND- THAT'S AB.
YOU SUCCESS. OF WHERE ARE BIT
OF POLICY NUDGING AND- CREATED
A AN ENORMOUS INDUSTRY AND
TODAY- I BELIEVE- MAYBE CALL IT
NOTWITHSTANDING. THAT SOLAR
INSTALLERS AS IS ONE OF THE
LARGEST EMPLOYERS. ALL IN ALL
INDUSTRY SEGMENTS IN THE U. S.
SO NOT JUST WORK. BUT EQUALLY
SO DO SHALL WE SAY TAXES OR
PENALTIES. SOMETHING LIKE A
CARBON TAX WHERE THE PROCEEDS
OF CARBON TAX ON HIGH CARBON
EMITTING INDUSTRIES NOT ONLY
CAN DRIVE MIGRATION TO PRINTER
SOLUTIONS. BUT YOU CAN TAKE THE
MONEY FROM THAT CARBON TAX AND
INVESTED IN GREEN OR SOCIAL
OUTCOMES SO THAT'S ANOTHER TYPE
OF THING THAT YOU CAN DO I MEAN
THEY'RE MANY OF THESE EXAMPLES
AND HAPPY TO DESCRIBE THOSE IN
MORE DETAIL. THE OTHER AREA
THAT I WOULD JUST POINT TWO AND
THEN I'LL STOP AND BE VERY
HAPPY TO TAKE QUESTIONS. IT MAY
BE CHALLENGING- THE LEGISLATURE
TO THINK ABOUT PUBLIC PRIVATE
PARTNERS. I CAN SEE- JUST IN
THE SEVERAL YEARS THAT I'VE
BEEN AT THIS WORK- ARE A REAL
SEA CHANGE. IN THE MINDSET OF
THOSE IN THE PUBLIC AND PRIVATE
SECTOR. WE USED TO. HAVE A SEAT
PEOPLE OPERATING IN DIFFERENT
SILOS WHERE THEY SAID THIS AREA
IS THE CURFEW OF GOVERNMENTS
AND THIS AREA IS THE PURVIEW OF
THE PRIVATE SECTOR. WHAT WE
FOUND AND I THINK THE ONE THING
DESERVES A LOT OF CREDIT FOR
THIS. BY SHOWING US WHAT THOSE
WORLD BIG CHALLENGES ARE
THROUGH THE U. N. SUSTAINABLE
DEVELOPMENT GOALS. IT ALLOWED
THE SCIENTIFIC AND ACADEMIC
COMMUNITY TO SIZE THE PROBLEM
IS WE'RE GOING TO TRY TO SOLVE
THE WORLD'S BIGGEST. CHALLENGES
BY TWENTY THIRTY WHAT'S IT
GOING TO COST. AND WHAT WE FOR.
IS THAT AND COST THAT WOULD TO
BE INVEST. IN THE SEVENTEEN
GOALS WAS SOMETHING ON THE
ORDER WE COPE AT. ABOUT THREE
TO FOUR TRILLION DOLLARS A
YEAR. AND WHEN YOU THINK ABOUT
THAT THERE ISN'T ENOUGH
GOVERNMENT MONEY FOR NON PROFIT
MONEY THAT EXIST IN THE WORLD.
TO FILL THAT GAP WE NEED THE
PRIVATE SECTOR TO PARTICIPATE
BUT THE PRIVATE SECTOR TO PART
PARTICIPATING CAN'T DO WHEN
IT'S ON IT'S ON IT NEEDS- A
COMBINATION. OF ALL OF THOSE
PLAYERS ON THAT FINANCIAL
SPECTRUM FROM CIVIL SOCIETY TO
GOVERNMENT PRIVATE SECTOR AND
EVEN PHILANTHROPIST TO WORK
TOGETHER. AND ANOTHER
BURGEONING AREA OF THIS OVERALL
SUSTAINABILITY IMPACT IELD IS
WHAT IS. A TOPIC CALLED BLENDED
FINANCE. AND THIS IS WHERE YOU
BRING DIFFERENT ACTORS TOGETHER
IN THE SAME PROJECT OR SAME
HAPPENED STRUCTURE. IN ORDER TO
BRING THE DIFFERENT EXPERTISE
OF THESE DIFFERENT TYPES OF SIX
TOGETHER TO HAVE A MULTIPLIER
FACTOR IN THE OUTCOME. SO YOU
MIGHT HAVE ANY GIVEN STRUCTURE
A LAYER OF THE PROJECT THIS
ISN'T GOING TO ACHIEVE.
CUSTOMARY MARKET RATES OF
RETURN SO YOU NEED CATALYTIC
WORK GOVERNMENT CAPITAL WORK
BABY PHILANTHROPIC CAPITAL. TO
PARTICIPATE AND TAKE THE
RISKIEST LAYER OF THAT
STRUCTURE OFF THE TABLE TO THE
IN CROWD IN. THE FOR PROFIT
PRIVATE SECTOR TO ALLOW IT TO
GENERATE ITS MARKET RATE OF
RETURN AND THEN YOU CAN UNLOCK
OFTEN SEEMINGLY INTRACTABLE
PROBLEMS. AND WE'VE SEEN THIS
CONCEPT OF BLENDED FINANCE ARE
BEGIN TO EXPERIMENT IN NUMEROUS
PROJECTS. ARE WHAT THEY BE
ENVIRONMENTAL OR SOCIAL AND
THEY'RE UNLOCKING PREVIOUSLY
REALLY INTRACTABLE HURDLES THAT
HAVE PROHIBITED THE PRIVATE
SECTOR FROM PARTICIPATING. AND
THAT'S AN IDEA OR NOTION WHERE
THE PUBLIC AND THE PRIVATE
COMING TOGETHER CREATES YOU
KNOW ONE PLUS ONE IS FAR MORE
THAN TWO. SO I'M JUST GOING NOW
THE NUMBER OF I. TO MAYBE LIGHT
FAR. AND THAT PERHAPS I DONE
LET JUST- TAKE A PAUSE AND- AND
BEGIN TO ENGAGE IN A
CONVERSATION. WELL THANK YOU
VERY MUCH- AND I'M TRYING TO
FIND A WAY TO LOOK AT YOU AND
I'LL GIVE MY MICROPHONE IT'S-
ONE OF THIS ONE OF THE
CHALLENGES OF- OF DOING THIS
REMOTELY- BUT- AND WEBER WERE
STOPPED FOR A MOMENT AND JUST
TO. MAKE SURE THE MEMBERS ARE
AWARE- OF- THIS IS A OF REALLY
VALUABLE OPPORTUNITY FOR US TO
ACTUALLY. HAVE A DISCUSSION.
WITH SOME THE IS VERY KNOWLEDGE
OF IN THIS FOR SO I. ALIVE AT
THAT GOING JUST NOW WONDER TWO
THAT YOU MAY BE CLARA. HOW
QUICK SO THAT WE CAN HAVE A
DIALOGUE- SO. WITH MS DREW HERE-
AND I'D LEVEL WILL JUST SHARE
WITH YOU A QUICK BACK AND- IN
TALKING- HER- BEFORE THIS SHE
TALKED ABOUT HOW AFTER THIRTY
YEARS OF WORKING WITH CREDIT
SUISSE. SHE WAS APPROACHED TO
TAKE ON THIS PROJECT FOR CREDIT
SUISSE AND I HOPE YOU DON'T
MIND ME SHARING THIS STORY BUT-
THEY BASICALLY SAID TO HER. IF
SHE HAD SHE SAID I'D BEEN THERE
GRINDING AWAY AND DOING. VERY
GOOD INVESTMENTS FR THE FOR
THE BANK AND- THEY CAME AND
SAID. SO WHAT DO YOU WANT YOUR
LEGACY TO BE RIGHT YOU DID A
GREAT JOB MAKING MONEY FOR THE
BANK OR- YOU WANT SOMETHING
ELSE AS YOUR LEGACY AND- SHE
HAS JUMPED ON BOARD. FOR CREDIT
SUISSE BUT I WOULD SAY SHE
JUMPED ON BOARD FOR ALL OF US-
IN TERMS OF REALLY TRYING TO-
MAKE AN IMPACT AND THAT'S WHY
SHE GENEROUSLY GIVING UP FOR
TIME- IN THIS KIND OF SETTING
SO WE HAVE A WE HAVE A GOLDEN
OPPORTUNITY. GEMINIDS TRY TO
MAKE SURE WE GET THROUGH AS
MANY QUESTIONS AS WE CAN AND SO
I'LL TRY TO KEEP THIS MOVING
EFFICIENTLY. I JUST HAVE A FEW
THINGS I WANT TO CLARIFY ABOUT
YOUR COMMENTS BEFORE I GET TO
ANY OTHER PREPARED QUESTIONS
YOU TALKED ABOUT- DISCLOSURE-
DEBT SOON. IT'S BEEN VOLUNTARY
BUT JUNE IS GOING TO BECOME
REQUIRED- DO YOU HAVE AN
OPINION ABOUT WHETHER
CALIFORNIA SHOULD TRY TO LEAD
THE WAY IN TERMS OF. REQUIRING
DISCLOSURE OR SHOULD WE WAIT
FOR MORE COMMON DISCLOSURE-
STANDARDS SHOULD BE ESTABLISHED
EITHER BY. THE UNITED STATES
GOVERNMENT OR EVEN BY. OF SOME
KIND OF GLOBAL STANDARD THAT IS
OUT THERE DO YOU HAVE AN
OPINION ON THAT. I WOULD SAY IT
IS FOR THOSE IN THE FINANCIAL
INDUSTRY- WHAT WE WANT IS.
COMMON DISCLOSURE AND A COMMON
SET OF STANDARDS I KNOW THIS IS
THE HOLY GRAIL FOR US- AS A
REGULATED ENTITY I CAN SPEAK ON
CAMPUS WITH. A LOT OF PASSION
ON THIS TOPIC BECAUSE- WHAT
WOULD BE CHALLEGING FOR US IS
IF WE FOUND- THANK YOU SAYING
THERE'S ONE STANDARD THAT YOU
MUST SUBSCRIBE TO IN TERMS OF
MANDATORY DISCLOSURE. AND THEN
WE FOUND- YEAH SINGAPORE SAYING
SOMETHING DIFFERENT AND THE
BLESSING SOMETHING DIFFERENT
AGAIN. I THINK THAT ALL THAT
WOULD DO IS SLOW DOWN THE
PROCESS AND CALL AND CAUSE
CONFUSION. SO WHAT I WOULD
RATHER SEE AS A HARMONY OF
ADOPTION. OF BUT A MANDATORY-
PUSH PUSH FOR MANDATORY
DISCLOSURE AND JUST BECAUSE I
DO SAY WITHOUT- REQUIRING IT.
YOU KNOW YOU DO LEAVE A LITTLE
BIT OF A FREE OPTION THERE'S
ALWAYS THE FREE RIDER RHYS. AND
I ALSO THINK WITHOUT MAKING IT
MANDATORY THEN YOU AREN'T BEING
PRESCRIPTIVE ABOUT WHAT THOSE
DISCLOSURES ARE AND THAT'S SO
MUCH OF WHAT THE FINANCE
COMMUNITIES ASKING FOR TO DRIVE
AND SCALE MORE CAPITAL TO THE
SPACE. SO AS AN EXAMPLE AND THE
CORPORATE SPACE JUST TO MAYBE-
MAKE IT TOO EASY TO BE A LOT
EXAMPLE. IF AN INVESTOR TODAY
SAYS I WOULD LIKE TO INVEST IN
SUSTAINABLE LEADER AND ESG
LEADER. AND THAT IS BECAUSE I
BELIEVE THATTHESE LEADERS ARE
GOING TO OUTPERFORM AND CREATE
REAL VALUE. TODAY IN A GIVEN
INDUSTRY IF YOU TAKE A LOOK AT
TWO COMPNIES SIDE BY SIDE IN
TERMS OF THEIR SUSTAINABILITY
DISCLOSURES. YOU WILL FIND
COMPLETELY DIFFERENT METRICS
THAT THEY DISCLOSE BECAUSE IT'S
VOLUNTARY SO I'M SLIGHTLY
CYNICAL OFTEN PROBABLY BUCKET
GIVEN MARKETS FOR AS LONG AS I
HAVE BEEN. BUT I TEND TO SAKE
PEOPLE VOLUNTARILY DISCLOSE THE
THINGS THEY'RE GOOD AT AND
PROBABLY NOT DISCLOSING THE
THINGSARE NOT SO GOOD AT. AND
THAT'S NOT HELPFUL FOR THE
FINANCIAL COMMUNITY SO THIS IS
WHERE I THINK REGULATIONS VERY
VERY IMPORTANT SO I WOULD
ENCOURAGE BECAUSE TI CFG. IS
REALLY TAKEN HOLD ON. NOW THERE
ARE MORE THAN. TWO THOUSAND
DIFFERENT ENTITY USE THAT ARE
ADOPT T. C. MORE ABOUT HER AND
SEVEN FIVE. TRILLION OF. A U.
M. ASSETS UNDER. OF IN THE
SERVICES IN. THEY'RE ADOPTING
T. CFT CORPORATES ARE AND
COUNTRIES. WE'VE SEEN EVEN THE
DEVELOPING MARKETS YOU OFTEN
WOULDN'T NECESSARILY BE
CONSIDERED TO BE SUSTAINABILITY
LEADERS- THAT ARE THAT ARE
FACING REAL CLIMATE ISSUES
COUNTRIES LIKE BRAZIL. THEY'VE
EVEN SAID THAT THEY WILL BE
ADOPTING T. CFT SO I WOULD SAY
TODAY. THE WORLD IS COALESCING
AROUND THIS BEING ONE OF THE
WAYS- THAT ONE CAN BE.
DISCLOSING UNDER A CONSISTENT
FRAMEWORK. THANK YOU SO. IN
GENERAL I CERTAINLY. CAN
APPRECIATE YOUR SUGGESTION THAT
WE NEED TO HAVE COMMON
STANDARDS I SHOULD ASSUME THAT
MEANS COMMON DEFINITIONS ALSO.
AND SO COULD YOU IF YOU KNOW
NOW OR COULD YOU HELP US AS WE
MOVE FORWARD. WITH WHERE DO WE
GO TO MAKE SURE WE STAY AND
SAYING WITH. THE DEVELOPMENT OF
THOSE COMMON STANDARDS
POTENTIALLY HAVE INPUT IN THOSE
COMMON STANDARDS. DO YOU HAVE
SOME SUGGESTIONS FOR US-
BRIEFLY AND IF WE MAY NEED MORE
TIME OFFLINE AFTER THIS BUT-
HOW DOES THIS CALIFORNIA
LEGISLATURE IF WE'RE
INTERESTED. STAY IN SYNC. WITH
ALL OF THE OTHER EFFORTS THAT
ARE OUT THERE. ABSOLUTELY SO-
CERTAINLY THE ONE THING I WOULD
SAY AND- THIS IS ALSO I'D SAY
ENDEMIC TO BEING VERY VERY FST
GROWING FIELD. IS THAT THERE
ARE- THERE'S BEEN A
PROLIFERATION OF THOSE TRYING
TO CREATE STANDARDS OF THEIR
OWN- I THINK THINK JOKINGLY SAY
THERE'S A COTTAGE INDUSTRY IN
THE STANDARDS SETTING AND THE
ESG RATING SERVICES AND
CONSULTANCY IRAQI SG. AND AND
THAT THAT MAKES SENSE BECAUSE
OF THE ORGANIC GROWTH BUT AT
THE SAME TIME WE ARE ALSO
SEEING AS A CRY FOR
CONSOLIDATION IN THE
CONSOLIDATION OF HARMONIZATION
IS HAPPENING. SO I WOULD SAY
THE PREVAILING- STANDARDS THAT
ARE EMERGING R. T. CFT SO I
WOULD HIGHLYENCOURAGE THE
LEGISLATURE TO GET FAMILIAR
WITH THAT AND- ANTI CFT TASK
FORCE WOULD BE I'M SURE
THRILLED TO ENGAGE WITH YOU.
AND SPEND TIME SO I THINK IT'S
SOMETHING LIKE A WORKSHOP. WITH
IT WITH THE T. CFT WOULD BE I
THINK HIGHLY BENEFICIAL FOR
THOSE WILLING AND STARTED DOING
A DEEPER DIVE. YOU KNOW WHAT IS
GOOD PRACTICE LOOK LIKE IF
COUNTRIES ARE DOING IT STATES
CAN CERTAINLY DO IT RUN YOUR
SCENARIO MODELING- AT WHERE
YOUR EXPOSURES ARE IN JUST
FORCING THE STATE TO THINK
ABOUT YOUR BUSINESS BIGGEST
RISKS- YOU KNOW WHETHER IT'S
MORE WILDFIRES ARE WATER
SHORTAGE OR RISING SEA LEVELS
AFFECTING PHYSICAL ASSETS. BUT
ALSO WHERE THOSE OPPORTUNITIES
WHERE CAN YOU TAKE THE THINGS
THAT MAKE CALIFORNIA SO SPECIAL
WHERE WHERE ARE YOUR MOST
IMPORTANT INDUSTRIES- NOT ONLY
LOOK AT IT WITH A RISK PLANS
BUT AN OPPORTUNITY LET SO I
THINK ABOUT SOMETHING LIKE
SILICON VALLEY- AND THE YOU
KNOW WONDERFUL TECH SECTOR THAT
HAS BEEN SUCH A PART OF
CALIFORNIA'S HERITAGE. AND SO
YOU KNOW YOU'RE YOU'RE U. S. B.
WELL WHAT ABOUT REALLY PUSHING
AS AN OPPORTUNITY SET.
SOMETHING LIKE THE GREEN TAX
BASE IN A VERY FORCEFUL AND
VERY VOCAL WAY- I CAN CERTAINLY
SAY I'M AN OPPORTUNITY SIDE THE
MOVING A LITTLE BIT AWAY FROM
DISCLOSURES BUT I'M SAYING IN
TERMS OF THINGS WHERE YOU COULD
JAM. SORT OF I LOOK AT. THE
VARIOUS OTHER INITIATIVES AND
THINK ABOUT WHAT'S. GOING TO BE
UNIQUE TO YOU- YOU CAN YOU CAN-A LOOK AT- TO AND THEY-
OPPORTUNITIES CAN. ALL SOME OF
THESE. WERE CHALLENGES THAT BE
ANOTHER PLAY WHERE I CAN THAT
NON HEALTH COULD BE VERY
INVESTED. BUT TO THIS CONCERT
OF- THESE OTHERS. AND DAY SO
YOU TO SEE. THE OTHER ONE THAT
IS. BECOMING VERY IMPORTANT IS
SAYS BECAUSE THE STAND OF ALL
ACCOUNTING STANDARDS BOARD.
THAT AGAIN IS A VOLUNTARY
ORGANISATION MOSTLY DESIGNED
FOR CORPORATES. AND IT'S AND
IT'S EFFECTIVELY- GOES BY
INDUSTRY. AND SAYS- FOR THOSE
WHO JOIN SAYS B. WE HAVE
IDENTIFIED THE MOST FINANCIALLY
MATERIAL SUSTAINABILITY FACTORS
FOR A GIVEN INDUSTRY. AND WE
WOULD HOPE AND EXPECT THAT THE
COMPANIES WOULD BEGIN TO
DISCLOSE THOSE METRICS SO WE
HAVE THAT COMMONALITY AND
COMPARABILITY FOR INVESTMENT
COMMUNITY. AND I THINK- FOR THE
CALIFORNIA LEGISLATURE IF YOU
LOOK AT WHAT THOSE MEANT
METRICS ARE. FOR THE GIVEN
INDUSTRIES THAT ARE MOST
IMPORTANT THE CALIFORNIA
ECONOMY. THAT WILL POINT YOU TO
THE PLACES WHERE DISCLOSURE
MIGHT BE PROMOTED. WHAT ARE THE
KEY LINE ITEMS THAT ARE GOING
TO BE MOST CRITICAL FOR YOUR
GIVEN KEY INDUSTRIES. THAT'S
ANOTHER PLACE WHERE I THINK-
YOU COULD EDUCATE YOURSELF ON.
ON STANDARD SETTING- SO I YOU
KNOW THERE ARE MANY MORE THAT I
COULD POINT TO I DON'T WANT TO
HIJACK THE WHOLE CONVERSATION
ON JUSTICE STANDARDS TOPIC
SHOULD BUT- WHAT WE ARE SEEING
FOR SURE. IS A HARMONIZATION
CONSOLIDATION AND THERE WILL BE
A MERGING LEADERS. AND I ALSO
THINK THAT THERE WILL BE GLOBAL
STANDARDS FOR WHAT IS MANDATORY
AND I WOULD JUST ENCOURAGE THE
STATE TO. TO FOLLOW ON RATHER.
THAN TRY TO. REINVENT THE WHEEL.
THANK YOU VERY MUCH AND I'M
GOING TO NOW TURN OVER TO THE
CHIU OF OUR- ASSEMBLY BY
COMMITTEE MISS GRACE. FOR HIS
QUESTIONS. FIRST OF ALL THANK
YOU MISTER FOR YOUR
PRESENTATION VERY VERY
INSIGHTFUL AND THAT EDUCATING
AND I APPRECIATE THE
INFORMATION. THAT YOU SHARED-
JUST HEARING YOUR LAST WORDS
HERE- WAS WAS- IT COST
POSITIVELY BECAUSE AYE AYE I
WANNA KNOW. THE IMPORTANCE FROM
YOUR PERSPECTIVE AND FROM YOUR
LANDS- YOU SPOKE OF THE KIND OF
THE COLLEGE ENVIRONMENT WHEN IT
COMES TO FORMING STANDARDS AND-
AND IT REALLY DOES MAKE A CASE
FOR. A CENTRAL AGENCY TO GET
INVOLVED TO CREATE THAT
CONSISTENCY ESPECIALLY IF WE'RE
TALKING- GLOBAL AND I THINK WE
LOOK WE ARE IN THAT KIND OF
ENVIRONMENT RIGHT NOW THAT
EVERYTHING IS GLOBAL SO. HAVING
SAID THAT WE CAN GOVERNMENT AT
TIMES GET WAY AHEAD OF OUR
SELF. AND SO WHAT I'M ASKING IS
WHEN IT COMES TO DEFINITIONS
AND FORMING THOSE CATEGORIES
THAT YOU TALKED ABOUT IN YOUR
PRESENTATION. DO YOU SEE- BOB
HAPPENING MORE EFFICIENTLY ON A
LINEAR- SETTING OR OR PLATFORM
OR IS THIS SOMETHING THAT CAN
BE DONE LIKE A BUFFET WHERE ALL
THE IDEAS ARE OUT THERE. AND
WE'RE JUST WE'RE WE'RE TAKING
WHAT WE CAN GET AT THE TIME AND
PUTTING TOGETHER THE PROGRAM
HOW IMPORTANT IS IT TO BE ABLE
TO HAVE THOSE DEFINITIONS. AND
THOSE CATEGORIES SET IN STONE
FIRST BEFORE OTHER THINGS
HAPPEN. IT'S A REALLY GREAT
QUESTION BECAUSE IS A VERY VERY
DYNAMIC SPACE AND YOU CAN
SOMETHING AS WHAT IS THE
DEFINITION OF GREEN. THERE ARE
SOME INDUSTRIES TODAY THAT DO
NOT HAVE A GREEN PATHWAY TO NET
ZERO OR PERSONAL LINES. AND SO
WHAT WE WANT TO PROMOTE IT AND
NOT VERY SPECIFIC EXAMPLE OUR
PATHWAYS WERE WERE TRANSITION.
EXERCISE ON THE PORT OF
CORPORATES IN THOSE INDUSTRIES
TO DO SOMETHING THAT'S GREENER
THAN WHAT THEY'RE DOING TODAY
BUT WE MAY NOT HAVE THE
GREENEST ANSWER BECAUSE THAT'S
GOING TO BE RELIANT ON
TECHNOLOGICAL INNOVATION. SO
WHAT I WOULD SAY IS WE DON'T
WANT THE PERFECT BE THE ENEMY
OF THE GOOD SO I DO THINK IT'S
VERY IMPORTANT TO GET STARTED
ON THE JOURNEY. AND NOT WAIT
TILL WE HAVE A PERFECTLY FORMED
BEAST BUT AT THE SAME TIME I
THINK WE DO NEED TO CONTINUE TO
PUSH. ALL OF US IN WHATEVER
PART OF- THE EQUATION WE FIND
OURSELVES AND WHETHER IT'S
POLICY MAKING OR THE FINANCIAL
SERVICES INDUSTRY OR CORPORATE.
I DO THINK WE WANT TO PROMOTE
HARMONY. ACROSS WHEN WE DO
SETTLE ON WHAT THESE
DEFINITIONS ARE SO I WOULD SAY
LET'S GO AND YOU SHOULD
INTERPRET WHAT GREEN MEANS TO
YOU IF THAT'S- AN AREA THAT YOU
WANT TO BE FOCUSED IN OR
SOCIAL. OR WHAT HAVE YOU AND TO
FIND OUT WHAT THAT MEANS TO YOU
AND THE WAY I INTERPRET THAT IN
SEATTLE SERVICES I SAY IN THE
ABSENCE. OF A GLOBAL DEFINITION
FOR GREEN I HAVE TO SAY WHAT I
THINK GREEN MEANS IN MY
INVESTMENTS THAT I'M CREATING
FOR MY CLIENTS AT THE VERY
TRANSPARENT ABOUT WHAT THAT IS
AND WHAT IT'S NOT. AND THEN I
ALLOW MY INVESTORS ARE MY
CLIENTS TO PARTICIPATE WITH
THAT FULL KNOWLEDGE AND THAT'S
WOULD BE MY BEST ADVICE NOW IS
TO GET GOING. PUSH YOURSELF TO
IN THE DIRECTION OF WHERE YOU
WERE. AND UP. AND THEN YOU KNOW
I THE WORLD WILL COME. TO I
KNOW THAT MANY- ARE SKEPTICAL.
OF COMBINING THE GOAL OF MARKET
RETURNS WITH- THE GOAL OF
SUSTAINABILITY AND SOCIAL
CHANGE. IS THAT SKEPTICISM A
REAL BARRIER OR- AND THEN ALSO
WHAT WOULD BE SOME OF THE OTHER
CHALLENGES. THAT YOU SEE TOWARD
MORE WIDESPREAD ADOPTION OF
IMPACTING OR IMPACT VEST
INVESTING. SURE SO- I WOULD SAY
IF YOU HAD LOOKED BACK SEVERAL
YEARS THERE WAS AN ENORMOUS
AMOUNT OF CYNICSM BECAUSE WE
WERE ALL TAUGHT ANY OF US THAT
YOU KNOW WE'RE IN THE- IN THE
FINANCE WORLD SELF INCLUDED YOU
KNOW IT IT WORKING WHEN I GOT
MY MBA WE NEVER TALKED ABOUT.
PURPOSE DRIVEN FINANCE OR
VALUES ALIGNMENT WITH YOUR
INVESTING OR COULD YOU ONLINE
PURPOSE AND PROFIT FOR POSITIVE
OUTCOMES THAT A RETURN. IT JUST
WASN'T SOMETHING THAT WAS IN
THE FRAME OF REFERENCE BUT NOW
I THINK TODAY WHERE WE ARE IS
THAT THERE THERE'S ENOUGH
MATURITY IN THIS IMPACTS BASED
ON THE BROADER SUSTAINABILITY
FIELD THAT WE HAVE A REAL PROOF
POINTS WE HAVE EXCELLENT
DEMONSTRATION. OF WHERE WE HAVE
CHEAT SHEET NOT ONLY MARKET
RATES OF RETURN FOR VARIOUS
ASSET CLASSES BUT-OUTPERFORMANCE BY COMBINING BY
TAKING THAT YES SHE LANDS AND
RUNNING ACROSS OUR INVESTMENTS
OR INDEED GOING FRTHER AND
SAYING I WANT TO ACHIEVE
DELIVERED OUTCOMES. AND I THINK
WHEN YOU ARE TRYING TO CHEAT
THESE POSITIVE OUTCOMES THAT
YOU THINK ABOUT WHAT IMPACT
YOU'RE TRYING TO MAKE. IT OFTEN
LEADS YOU INTO INTERESTING
PLACES THAT YOU WOULDN'T HAVE
OTHERWISE THOUGHT ABOUT- AND
THEN WHAT HAPPENS AS AN
INVESTOR AND I OFTEN SAY THE
CYNICISM BEGINS WITH CAN YOU
REALLY DO IT. I ALWAYS AND
CHALLENGE PEOPLE TO SAY WELL
I'M IN A POSITIVE PIECES THAT
YOU CAN SO IF YOU GIVE ME A
LITTLE CAPITAL AND LET ME GIVE
IT A TRY AND I CAN PROVE TO
YOU. THAT NOT ONLY CAN I
GENERATE AT THE VERY MINIMUM
MARKET RATE OF RETURN BUT I CAN
ALSO HAVE. A POSITIVE IMPACT ON
THE WORLD. HOW CAN YOU KNOW
LIKE THAT LET'S NOT TO LOVE.
AND AT THAT SITTING GO THAT
STEP. ONCE YOU PROVE IT TO THEM
THEN ALL OF A SUDDEN I FIND
THOSE CYNICS BECOME YOUR
GREATEST CONVERTS AND THEY
BECOME AMBASSADORS FOR THE
OVERALL SECTOR. BECAUSE THEY
ARE SO THRILLED WITH THE FACT
THEY'VE BEEN ABLE TO POSITIVE
REVIEWS. WITH CAPITAL SO WHAT
I'M SAYING IS THAT TODAY WERE
IN A PLACE WHERE WE HAVE MANY
GROUP POINTS ACROSS ASSET
CLASSES. WE ALSO HAVE A GREAT
GROUP POINTS THROUGH THE CYCLE.
WOULDN'T WE'VE HIT THE WORST OF
THE WORST AND CO THAT BACK IN
MARCH OF LAST YEAR WHEN THE
MARKETS WERE JUST GETTING
ABSOLUTELY HIT. THROUGH THE
FEAR ENDS AND THE RESPONSE TO
COALBED. WE SOLVED THIS IS
SCALABLE STRATEGIES AND SO MANY
IMPACT STRATEGIES OUTPERFORMED
FAIRLY SUBSTANTIALLY MEETING
PLACE. NOT JUST IN THE WORST OF
THE CRISIS BUT THROUGH THE
RECOVERY PERIOD AS WELL SO I
THINK THERE'S AND WHEN WE TALK
ABOUT RISK ADJUSTED RETURN
RESILIENCY. YEAH WE ALSO HAVE
TO TAKE INTO CONSIDERATION IT'S
NOT JUST HEALTH OUTPERFORMANCE
IT'S ALSO RISK ADJUSTED
RETURNS- RETURN MEDICATION. AND
SO- AND THEN THE FINAL PIECE I
WOULD POINT TO AS WELL AS IN
ANY GOOD INVESTING STRATEGY.
YOU WANT TO HAVE
DIVERSIFICATION. AND OFTEN
THINKING ABOUT IMPACT NEEDS YOU
AS A STATE TO PLACES THAT YOU
HADN'T THOUGHT OF BEFORE AND IN
A GOOD PORTFOLIO CONSTRUCTION.
YOU WANT TO HAVE A DIVERSE SET
OF OPPORTUNITIES THAT YOU'RE
INVESTED IN. THIS IS A MERGING
IMPACT SPACE. ISN'T SO CROWDED
SO OFTEN TIMES THAT THE
INVESTMENTS THAT YOU CAN GET
INVOLVED IN. I DON'T HAVE HUGE
BIDS FOR THEM THAT THE ASSETS
AREN'T OVERPRICED SO THE
OPPORTUNITY GREAT VALUE ALONG
THE WAY AS AN INVESTOR IS VERY
MUCH THERE WE CALL THAT THE-
THE OUR TRANSITION IMPROVERS.
NOT GENERATING THAT VALUE AS AS
THEY'RE ON THAT TRANSITION
JOURNEY. YOU ASKED ABOUT OTHER
HURDLES- CLEARLY IN MY OPINION
ONE OF THE BIGGEST ONES IS THIS
LACK OF A COMMON DEFINITION FOR
WHAT IS SUSTAINABLE OR WHAT IS
GREEN OR WHAT IS IMPACT. BUT AS
I SAY THERE ARE MANY GREAT
MINDS ARE AT WORK TRYING TO
DEFINE THAT. AND. WE'LL GET
THERE IN TIME AND AGAIN THAT'S-
VERY MUCH THE SIDE OF A MATURE
SPACE. HAVING BEEN IN THE FROM
YEARS AS I WAS. EARLIEST ASSET
CLASSES LARGE- ONE OF THE- TO
UNLOCKING SCALE. WAS TO GET O
COMMON. AND A COMMON ADAPTION
OF. SHALL WE SAY WHAT GOOD
LOOKS LIKE. IN A GIVEN SPACE
BUT WE WILL GET THERE. I WOULD
SAY THE FINAL SPACE- YOU KNOW
WHERE WE SEE HURDLES- IS JUST-
THE- THE ABILITY TO- DENTED TO
MEASURE. THE OUTCOME SO
SOMETIMES MEASUREMENT AS WELL
AS IN THE EYE OF THE BEHOLDER
SO IF YOU ARE MAKING AN IMPACT
INVESTMENT IN TRYING TO ACHIEVE
AN OUTCOME- YOU NEED TO BE ABLE
TO BE RIGOROUS ABOUT WHAT
YOU'RE MEASURING. AND YOU ALSO
NEED TO BE SOMEWHAT FLEXIBLE
BECAUSE SOME OF THESE
INVESTMENTS AS IN THIS DYNAMIC
SPACE THAT WE'RE IN YOU LEARN
AS YOU GO. SO WHAT IS THE BEST
OUTCOME YOU MIGHT HAVE TO HIT
IT OR TWEAK YOUR STRATEGY A
LITTLE BIT TO ACTUALLY CHEAP
HILLS MALCOLM THAT YOU NEED. SO
ON THE ONE HAND YOU HAVE TO
HOLD YOURSELF TO A VERY HIGH
ACCOUNT AND WHAT YOU'RE
MEASURING AND WHAT YOU'RE
REPORTING ON. ON THE OTHER HAND
YOU HAVE TO GIVE YOURSELF THE
NEXT FOR A NETFLIX ABILITY TO
TWEAK AND ADJUST YOUR BUSINESS
PLAN BUSINESS MODEL TO PURSUE
WHAT WORKS. AND SO I THINK
THESE ARE THE THINGS THAT-
WALKOM AS AS THE SPACE-
CONTINUES TO MATURE AND
MAINSTREAM. BUT TODAY THOSE ARE
SOME OF OUR BIGGEST CHALLENGES.
THANK YOU SO MUCH. THANK YOU
VERY MUCH. THIS QUESTION SAID.
ASSEMBLY MEMBER GRAYSON. AND
SILVA MEMBERS. WE NORMALLY
DON'T HAVE A DISCUSSION AT
COMMITTEE HEARINGS- WE HAVE
SORT OF FORMAL QUESTION TOOK
CENTER- THIS IS DREW'S INVITED
US TO HAVE A DISCUSSION AND TO
THE EXTENT THAT- YOU'RE WILLING
TO IT. I THINK IT COULD BE A
GREAT OPPORTUNITY FOR US TO
HAVE- THIS THIS OF THIS- CALM
KIND OF CONVERSATION WHICH WE
WHAT DON'T DO VERY OFTEN. AND I
SEE SENATOR MA'AM- IS READY T
KICK OFF THE COULD THAT THE
CONVERSATION SO- GO HEAD SENATE
ARAMBULA. WELCOME AND- SENATOR
ALLEN JOINED THIS YEAR NOW TO
WELCOME. I THINK TEACHER
BENNETT THANK YOU VERY SEN AND
THANK YOU SO MUCH MISTER I.
GREATLY APPRECIATE YOUR-
PERSPECTIVE I THINK IT'S
EXACTLY THE PRODUCTS WE NEED TO
TAKE- I KIND OF WANT TO TAKE.
IT TANGENTIAL QUESTION- THERE'S
KIND OF A RELATED DEBATE I KNOW
IN IN CAPITAL MARKETS THEORY.
AROUND WHETHER OUR MARKETS ARE
TOO SHORT TERM IN THEIR
OUTLOOK. AND I'M WONDERING TO
WHAT DEGREE THIS IS TIED TO
THAT AND I GUESS WHAT I'M
THINKING ABOUT THIS IN
PARTICULAR. YOU KNOW I'M
IMAGINING LIKE WE NEED A LOT OF
MONEY. ONCE AND R. AND B. AND
THINGS LIKE THAT YOU MENTIONED
GREENTECH AND I THINK THAT'S
EXACTLY RIGHT WE NEED. THAT
CAPITAL GO THERE AND PRIVATE
CAPITAL. COULD COULD REALLY
FLOOD THE ZONE HERE. BUT THAT
TYPE OF INVESTMENT HAS SUCH A
LONG TERM OUTLOOK- AND WHEN I
THINK OF U. S. CAPITAL MARKETS
TODAY I THINK OF GAME STOP AND
DOES KOREAN. YOU KNOW A VERY
SHORT TERM IS. ALEX HAD HOW DO
WE IN THE GOVERNMENT. ACTUALLY
MOVE TO LONG TERM OUTLOOKS A
AND ONE. WOULD AN EMPHASIS ON
ON MAYBE. LONG TERM CASH- TAX
POLICY OTHERWISE. AND PUNISHING
SHORT TERM HORIZONS ALSO HAVE.
POSITIVE IMPACTS ON ON GREEN
INVESTMENTS ON ON THE TYPES OF
PRIORITIES YOU'RE YOU'RE
LOOKING AT AS WELL. YES YEAH
WITHOUT QUESTION ON THIS IS
WHERE I WAS GETTING A LITTLE
BIT INTO THIS CONCEPT OF
NATCHEZ- WHETHER IT'S POSITIVE
OR NEGATIVE SO IT COULD BE NOT
JUST A PENALTIES- SO I AGREE
TYPICALLY WHEN YOU'RE TRYING TO
CREATE. DEEP IMPACT. IT IS A
LONG TERM STRATEGY AND
TYPICALLY NEEDS TO BE AN
ILLIQUID STRATEGY. SO WHAT YOU
SEE IS THE IMPACTS FACE BEING
PREDOMINANTLY. IN THE PRIVATE
EQUITY OR AND INDEED SOMETIMES
VENTURE SPACE. AND THOSE BY
DEFINITION TEND TO BE TENURE
STRATEGIES- WITHOUT LIQUIDITY-
SO YOU WANT THAT CAPITAL STAY
IN THERE TO DRIVE THOSE
OUTCOMES BUT IT'S NOT
EXCLUSIVELY THAT. SO DRIVING
OUTCOMES CAN COME IN DIFFERENT
WAYS. AND I THINK WHAT WE NEED
IS AS A BALANCE ACROSS THE
SPECTRUM BACK TO MY PORTFOLIO
DIVERSIFICATION YOU WOULDN'T
WANT YOUR ENTIRE PORTFOLIO AS
AN INVESTOR TO BE FALL INTO
LIQUID PRIVATE EQUITY
STRATEGIES AS MUCH AS THEY'RE
NEEDED. AND THEY CAN GENERATE
THOSE LONG TERM IMPORT RETURNS
BUT WHAT CAN YOU DO AS
POLICYMAKERS. I THINK YOU CAN
THREE TAX YOU CAN INCENTIVIZE.
LONG TERM HOLDS AND WE'VE DONE
THAT ALREADY IN THE PRIVATE
EQUITY INDUSTRY ALTHOUGH THAT
MAY CHANGE. BUT WITH THINGS
LIKE YOU KNOW HOW YOU TAX
CARRIED INTEREST HOW YOU TAX
PROBABLE THAT GOES INTO P. E.
R. VENTURE. I THINK THAT'S ONE
WAY ANOTHER WAY IS TO THINK
ABOUT WHAT WHAT IS THE CAPITAL
THAT GETS INVESTED IN THOSE
ILLIQUID STRATEGIES- ONE OF THE
NOTIONS THAT I AM. AS ALWAYS-
SOMEWHAT BOTHERED ME A LITTLE
BIT. IS THAT- WE- WE EQUATE
ILLIQUIDITY ALWAYS WITH A LOT
OF RISK. AND MOST OF OUR POLICY
MAKING IN FINANCIAL SERVICES-
DOESN'T ALLOW RETAIL INVESTOR
THERE'S ALWAYS OFTENTIMES MOM
AND- IN THE- TO GET A- IN
PRIVATE. WE JUST THAT SEE YOU
HAVE BE SET. TO BE THE LIQUID
IN THE HOT INSTRUMENT. AND YET
I SAY WE CAN ALLOW A MOM AND
POP AN INDIVIDUAL INVESTOR TO
BUY GAMESTOP OR TO BUY A SINGLE
SHARE WHICH HAS THE POTENTIAL
TO DO. AS MUCH AS IT CAN GO UP
YOU CAN GO TO ZERO BUT IF WE
LOOK OVER THIRTY YEAR HISTORY
AND WE LOOK AT THE TOP TIER ONE
PRIVATE EQUITY. FIRMS I CAN'T
THINK OF A SINGLE STRATEGY. OF
A PRIVATE EQUITY FUND THAT HAS
GONE BUST THEY MAY NOT HAVE MET
THE 30% OR 25% RETURN HURDLES.
BUT THAT THE NUMBER THAT HAVE
GONE TO ZERO VIRTUALLY NOW SO I
THINK EVEN IN THINGS LIKE WHAT
IS APPROPRIATE IN A PENSION
FUNDS. IF WE CAN CREATE
INCENTIVES TO HAVE BALANCE
BETWEEN ILLIQUID STRATEGIES AND
LIKE WITH. AND THEN WE GIVE THE
RETAIL INVESTOR THAT
OPPORTUNITY TO HELP US DRIVERS
LONG TERM OUTCOMES WHILE.
GIVING THEM AN APPROPRIATE RISK
ADJUSTED RETURN ACCESS TO THOSE
WONDERFUL DOUBLE TO. THAT THEY
MY NOT A GET THAT COULD BE PER.
PLACE FOR TO DRIVE POSITIVE
OUTCOMES. SO I DID ARE. THINGS
THAT YOU COULD DO TO DRIVE
THAT. YOU KNOW THE REVERSE IS
TRUE WHAT WE'RE TALKING ABOUT
WAS SOME OF THE- NEW TAX POLICY
THAT MAY COME OUT. OF THE TEN
SHIRLEY CREATING HUGE
INCENTIVES FOR PEOPLE TO GO
INTO ETFS- YES SO THIS SHORT
TERM. LIQUID TRADED PASSIVE
INSTRUMENTS SO YOU CAN SEE HOW
VERY QUICKLY PROBABLY SEE ALL
OF THAT TO BEEN WRITTEN ABOUT
QUITE ACTIVELY IN THE LAST
SEVERAL WEEKS WITH SOME OF THE
NEW POLICY. REGULATION AND
MAYBE COMING OUT ON TAX- IN- IN
THE BY THE MINISTRATION. VERY
VERY QUICKLY CAP THROW WILL. IF
YOU PROVIDE DIFFERENCE. SO
THERE'S A TO DO IT WITH TAX
AWAY THINK ABOUT IT IN. IN
FUNDS OR OTHER FUNDING. THERE'S
ANOTHER WAY YOU COULD DO IT-
INSURANCE COMPANIES ARE
DESPERATE TO MATCH FUND LONG
TERM ASSETS AND LONG TERM
LIABILITIES. IF YOU WENT TO THE
INSURANCE INDUSTRY AND SAID LET
ME GIVE YOU SOME POSITIVE
INCENTIVES SOMEHOW FOR
PROMOTING YOU TO DO MORE OF
THIS TYPE OF IMPACT INVESTING
IS FULLY ALIGNED PARTICULARLY
ON CLIMATE. WITH THE INSURANCE
INDUSTRY'S. SUSTAINABLE HEALTH.
RIGHT BECAUSE THEY DON'T WANT
TO HAVE. UNDER OF BILL OF
DOLLARS OF PAYOUTS CLIMATE
RELATED WEATHER EVENTS AND WE
WOULD LIKE THEM TO TAKE THAT NO
THOSE THOSE- PREMIUM MONIES AND
INVEST THEM RIGHT BEHIND THE
VERY STRATEGIES THAT WILL
ACTUALLY BE IN THAT WIN WIN
FROM THEIR OWN BUSINESS MODEL.
AND MAKING SURE THAT- THAT- YOU
KNOW- ITS PAYOUTS TO BE LESS
BECAUSE WE'RE SOLVING THE
CLIMATE PROBLEM. SO I DO THINK
THIS REQUIRES SOME DEEP THOUGHT
BUT I THINK THE OPPORTUNITIES
ARE THERE FOR US TO RETHINK-
SHORT TERM VERSUS LONG TERM
INCENTIVES. IF YOU COULD HAVE A
QUICK FOLLOW UP YEAH I JUST ONE
QUICK QUESTION ON YOU KNOW WHAT
WHAT ABOUT DIRECT INVESTMENT
FROM THE GOVERNMENT I MEAN. NOT
IN IT REALLY IN THE RISKIER
STUFF WHICH YOU KNOW
HISTORICALLY. WE'VE BEEN LOATH
AT THE GOVERNMENT INVEST IN
EQUITY. YOU SEE A ROLE FOR
DIRECT INVESTMENT FROM THE
PUBLIC SECTOR IS A SHOULD THAT
SOLELY PRIVATE. CAPITAL IF WE
LOOK AT THE GREEN NEW DEAL
PERFECT EXAMPLE IN THE EO- I
KNOW I SAID IN LONDON SO I'M
VERY CLOSE TO A LOT OF THE
EUROPEAN WORKS I DON'T MEAN
THAT THEY ARE THE ALL AND ALL
THAT. BUT I THINK IT'S VERY
PROVOCATIVE PART OF THE GREEN
NEW DEAL IS INCENTIVIZING
ACTUAL CAPITAL INVESTMENTS- IN
THE CITY'S GREEN OR AND ALSO
SOCIAL. OUTCOMES THAT THEY ARE
REALLY DRIVING IS VERY HEAVILY
FOCUSED ON ON GREEN BUT SIDE
COUPLE JUST TRANSITION SO
THEY'RE NOT FORGETTING THE
SOCIAL ASPECT OF IT AS WELL.
BUT NONE OF THE TRILLION EUROS
THAT WILL BE INVESTED IN THE
GREEN DEAL WHICH IS PROMOTED
BY. ESSENTIALLY AN
INTERGOVERNMENTAL BODY- IS
THERE BASICALLY THAT HAVE KEPT
US SEVEN TO EIGHT SECTORS THAT
THEY THINK ARE CRITICAL. TO
MITIGATE CLIMATE CHANGE AND
BEING VERY FIRST. OF BACKDOOR
JEFF. OF WHAT WOULD BE AND- IN.
BUT OF COURSE OF THAT WILL BE
IN IN FACT. IN VENTURE. BECAUSE
WE KNOW THAT WE'RE GONNA SOLVE
CLIMATE CHANGE- THE SCIENCES
AND ACADEMIC ACADEMIA WILL TELL
US. ABOUT A THIRD OF WHAT'S
GOING TO BE REQUIRED OUT OF THE
TRILLIONS OF INVESTMENT. IS
GOING TO NEED TO BE IN WHAT I
CALL THE TRANSITION. AND
PROCESS IMPROVEMENT SO THAT'S A
VERY SIMPLE TWEAKING. BUT A
THIRD OF IT IS GOING TO NEED TO
COME FROM TECHNOLOGICAL
INNOVATION SO IT'S GOING TO BE
ADVANCES IN CARBON CAPTURE AND
REEN HYDROGEN ALL OF THIS.
THOSE ARE GOING TO BE IN MY
OPINION LONG TERM YOU KNOW
BERMAN S. VALUE CREATION
OPPORTUNITIES. THANK YOU AND
HAVE A BALANCED APPROACH A
PORTFOLIOAPPROACH BUT IF THE
GOVERNMENT CAN PROVIDE EITHER
INCENTIVES FOR THOSE INDUSTRIES
THAT THRIVE IT COULD BE TAX
INCENTIVES AND THAT'S ANOTHER
WAY FOR YOU TO INVEST. OR
ACTUAL DIRECT INVESTMENTS MY
BELIEF IS THE RETURN ON THOSE
INVESTMENTS COULD BE ENORMOUS
FOR THE GOVERNMENT. BECAUSE IT
ALMOST BY DEFINITION I GUESS
THE WAY I LOOK AT IT IS. IF
YOU'RE SOLVING INTRACTABLE
PROBLEMS. FIND ASSESS CITY-
THOSE COMPANIES AND THOSE
INDUSTRIES. IN THIS BUSINESSES
WHICH CRACKED THAT. CODES SO TO
SPEAK WE'RE GOING TO CREATE
THAT IN IT OF THEM. ARE BE
SUSTAIN THIRD THERE NEEDED. AND
SO THIS IS WHY YOU SEEN. EACH
VALUE CREATION AND ELECTRIC
VEHICLES AND- NO TURNING TO
FOOD AND ALL THESE OTHER
THINGS- SO I THINK THAT YET
AGAIN I WOULDN'T PUT THE ENTIRE
STATE PENSION FUND IN THERE
BUT- I THINK IT REASONABLE.
PORTION ALLOCATION INTO THIS
SPACE I WOULD GENERATE GREAT
RETURNS AND ALSO SEND ALL THE
RIGHT SIGNALS. OTHER MEMBERS
WITH THE QUESTION AND- I'LL USE
THIS OPPORTUNITY- APPRECIATE
THAT- ASSEMBLY MEMBER OF
THREE OF US WHO ARE GOING TO
CALL IN FOR QUESTION IN JUST A
SECOND BUT ALSO ASSEMBLYMEMBER
ROB RIVAS JOIN ASSEMBLY MEMBER
CERVANTES AND ASSEMBLYMEMBER
MCCARTY. AND ASSEMBLYMEMBER
BURKE- WHO REINTRODUCED
EARLIER- IS- IS NOW IN THE
ASSEMBLY WITH TO SELL
ASSEMBLYMEMBER. LUIS RIVAS.
THANK YOU ASSEMBLY MEMBER BAND
AT FIRST I WANT TO THANK YOU
AND ASSEMBLYMEMBER GRAYSON- FOR
ORGANIZING THIS HEARING SUCH AN
INTERESTING TOPIC- AND
SOMETHING I'M VERY INTERESTED
IN SO THANK YOU- INTO THE
SPEAKER THANK YOU FOR JOINING
US TODAY- SO I WAS READING. OF
THE ARTICLE THAT WAS INCLUDED
IN OUR PACKAGE FOR THIS HEARING
ON THE WARNING THAT
CORPORATIONS ARE GETTING ABOUT
CREDIT RISK RIGHT FOR CAPITAL
FOR CARBON INTENSIVE ACTIVITIES
RIGHT AND I KNOW THAT'S BEEN A
HOT TOPIC- RECENTLY I KNOW
THERE'S A- FEDERAL PROPOSAL
RIGHT TO- REQUIRE CORPORATIONS
I THINK TO REALLY- DISCLOSE. AT
LIKE SOME TYPE OF RISK
ASSESSMENT RIGHT THAT THE
EFFECTS OF CLIMATE CHANGE AND
HERE IN OUR STATE- SOME OF MY
COLLEAGUES ALSO RIGHT NOW THERE
SOBRE PROPOSAL'S GOING THROUGH
THE LEGISLATURE. BOB AND SO MY
QUESTION YOU KNOW THERE WAS
SOMETHING IN THIS ARTICLE THAT
SAYS THAT JUST THE MERE FACT
THAT THESE FINANCIAL
INSTITUTIONS ARE LEARNING
COMPANIES. THAT THERE IS A
CREDIT RISK- IS THAT IT IS
HAVING IMPACT AND SO I'M
CURIOUS LIKE WHAT IMPACT IS
THAT ALREADY HAVE ENOUGH YOU
KNOW AND AS A STATE GOVERNMENT.
WHAT CAN WE DO- TO ENCOURAGE
THAT IN CALIFORNIA- I KNOW
THAT. I HAVE SOME ISSUES WITH
OUR ENVIRONMENTAL REGULATORS
BEING INVOLVED IN THIS- VERSUS
A FINANCIAL INSTITUTION BUT
IT'S KIND OF A MIX OF SINCE
WE'RE TALK ABOUT CLIMATE CHANGE
AND FINANCIAL RISK OR CREDIT
RISK IT'S KIND OF A MIX OF TWO
AND I JUST DON'T KNOW. WHO IS
THE MOST QUALIFIED WITHIN OUR
OUR GOVERNMENT TO DO THAT SO
JUST YOUR THOUGHTS ON ANY OF
THAT HELPFUL OKAY- OKAY I'LL
TRY TO OF COURSE THE FIRST.
THAT UP A LITTLE BIT INTO YOUR
QUESTION IS I CAN- MAYBE GIVE
YOU AN OF OUR OWN INSTITUTE. SO
JUST AS YOU WERE SAYING THIS
THIS REQUIREMENTS INCREASINGLY
WHICH IS TODAY- VOLUNTARY BUT
WILL BECOME MANDATORY BUT THE
REQUIREMENT EVEN WITH THE E.
YOU. TO TAKE A TO SHOW THAT
WE'VE TAKEN THIS INTO
CONSIDERATION YES AND SHE AND
THEN IN FACT THIS TASTY F. T.
WHICH HAS FORCED US TO TAKE A
LOOK AT OUR EXPOSURES ARE
LENDING EXPOSURES AS A BANK TO
GREEN AND BROWN INDUSTRIES. AND
THEN RUN SCENARIOS UNDER SAY A
ONE AND A HALF OR TWO OR EVEN
3 DEGREES SCENARIO WHAT DOES
THAT LENDING BOOK LOOK LIKE HOW
EXPOSED IS IT TOO SAFE PHYSICAL
RISK- IF WE'RE HOLDING A BIG
PORTFOLIO OF SAY COASTAL REAL
ESTATE- IF WE HAVE A TWO OR
THREE DEGREES- SCENARIO. AND WE
HAVE THE SEA LEVEL RISES THAT
SCIENTISTS ARE PREDICTING HOW
MUCH OF THAT ASSET THAT WE HAVE
ON OUR BOOKS IS GOING TO BE
IMPAIRED. AND THAT'S THE MATH
THAT WE ACTUALLY HAVE TO RUN IN
DEMONSTRATE UNDER G. CFT SO THE
MERE FACT THAT THAT KNOWLEDGE
WERE PUSH IS MAKING US DO THAT
WORK. ALL OF A SUDDEN THEN WHAT
DOES THAT DO THAT IS DRIVING
THE BEHAVIOR CHANGE IN OUR
INSTITUTION AS TO THINKING
ABOUT. WHO WE WANT TO LEAD TO
OR WHAT HI OF BUSINESSES AND
WHAT. OF DO WE WANT TO LEARN TO
SO IT CREDIT SUISSE HAVE CREE
SOMETHING THAT WE ON C. E.
DECLINE ENERGY TRENDS.
FRAMEWORK AND WE WERE DOING IS
WORSE. GOING EACH OF HIGH MANY
IN THIS. TOP TO BOTTOM STAR
WITH OIL AND GAS. AND WORKING
ON WAY DOWN TO EVERYTHING FROM
SHIPPING TO AVIATION AND
WHATEVER. AND WE HAVE MAPPED
ALL THE CLIENTS THAT WE BANKS
AGAINST- THERE IS A HIGH CARBON
INDUSTRIES AND WE'RE MAPPING
THEM ON A CURVE- RANGING FROM
COMPANIES TO WEEK WHO ARE
UNAWARE. AND SIMPLY OUR
INDICATING THAT THEY WANT TO
THEIR- OR MIGHT BASS MODEL. ALL
THE WAY THROUGH PROGRESS
COMPANIES MAY BE IN THIS
INDUSTRY WE SEEM REALLY MAKING
CHANGE TO MIGRATE. TO SAY
INVEST IN- BUSINESS MODEL
CHANGE. AND IT WON'T BE A
SURPRISE TO ANY OF YOU THAT
WHAT WE'RE DOING IS AT AND SO
MAPPING THOSE THOSE COMPANIES
ALONG THAT SPECTRUM- WE SAID TO
OURSELVES THAT WE'RE GOING TO
ULTIMATELY. HAVE A SUNSET
PROVISION. ON THE RELATIONSHIPS
WITH CLIENTS WHO DON'T
DEMONSTRATE AN AWARENESS TO
CHANGE AND A DESIRE TO CHANGE
BECAUSE WE THINK THAT THOSE
ASSETS ARE THOSE COMPANIES
THOSE EXPOSURES ALTERNATELY
BECOME IMPAIRED CREDITS. IN IN
THE NOT TOO DISTANT FUTURE SO
BASICALLY THE BEHAVIOR CHANGES
THAT WE'RE NOW MIGRATING. WHO
WE WANT TO THANK IN FUTURE AND
THAT'S THE COMPANIES THAT I
DON'T WANT TO TRANSITION OR
THAT ARE ALREADY- IN THAT- THAT
GREEN SPACE SHALL WE SAY. SO
THIS IS SORT OF A LONG WINDED
ANSWER TO YOUR QUESTION BUT I
THINK THAT MAYBE THAT
ILLUSTRATION GIVES YOU A SENSE
OF JUST HOW SERIOUS THIS IS. SO
THAT'S ONE ASPECT OF IT.
ANOTHER ASPECT OF IT WHEN WE
TALK ABOUT WHETHER THIS IS THE
FIRST YOU OF LEGISLATURE OR
JUST LET MARKET FORCES AT WORK.
I CAN CERTAINLY TELL YOU THAT
THE DRUMBEATS OF THE CLIMATE
ACTIVISTS ARE LOUDER AND
LOUDER. AND THAT'S MANIFESTING
ITSELF IN INSTITUTIONAL AND-
EIGHT. GOING INTO CORPORATES
AND SAYING IT'S ALL THIS DIVEST
CAMPAIGN TYPE WORK THAT SAY.
THINGS LIKE YOU KNOW UNLESS
YOU'VE DEMONSTRATED THAT YOU'RE
ON A PATH TO NET ZERO PARIS
ALIGNMENT WE CAN NO LONGER HOLD
YOUR STOCK. AND WHEN COALITIONS
OF INVESTORS GO INTO A
CORPORATE AND WE'RE TALKING ON
THE LARGE CAP CORPORATES WE'RE
SEEING COALITIONS FORM OF.
BILLIONS OF DOLLARS OF
SHAREHOLDER CAPITAL DEMANDED IN
THE CLOCK COMPANIES RESPOND TO
THAT OR THEY WILL DIVEST IT'S A
VERY POWERFUL MOTIVATOR. SO I
THINK THERE IS AN ELEMENT THAT
THAT THIS IS ALMOST TAKING CARE
OF ITSELF. BUT WHERE I. THINK
POLICY COULD EXCEL THE RATE
THAT IS WHAT IF HAD- CAPITAL
GAINS AND- FOR A- IN GREEN. FOR
CAPITAL HITS IF YOU WILL. FOR
CONTINUING TO. LAND TO BROWN SO
FINANCIAL SERVICES INDUSTRY IN
ONE OF OUR BIGGEST ISSUES IS WE
HAVE TO SET ASIDE CAPITAL OR
RISK WEIGHTED ASSETS AGAINST
THE RISKIER ASSETS. WELL IF
RISK ISN'T BEGINNING TO
INCREASINGLY BE DEFINED AS-
CLIMATE RELATED RISKS RIGHT- OR
THE RISK OF STRANDED ASSETS-
ALL OF A SUDDEN IT'S GOING TO
BE VERY VERY EXPENSIVE. FOR US
TO CONTINUE TO LAND BROWN
INDUSTRIES WE WON'T DO IT
ANYMORE. AND THEN THOSE
COMPANIES WILL BE STARVED OF
CAPITAL IN WHICH CASE THEY'LL
EITHER HAVE TO MIGRATE AND
TRANSITION. OR THEY WON'T
SURVIVE AND SO I THINK POLICY
COULD ACTUALLY ACCELERATE THAT
CHANGE YOU KNOW IF THAT IS
SOMETHING THAT WOULD BE ON THE
AGENDA. SO THAT THAT COULD BE A
VERY POWERFUL TOOL IN
CONJUNCTION. WITH THE FINANCIAL
SERVICES INDUSTRY AND YOU DON'T
HAVE TO BE A CLIMATE SCIENTIST.
AT TO MAKE THAT HAPPEN YOU KNOW
I DON'T THINK YOU NEED DEEP
EXPERTISE IN CLIMATE SCIENTISTS
YOU CAN SAY WHAT ARE NOT
JUSTIFIED REALLY SEE
FUNDAMENTALLY I WANT TO DRIVE.
GREEN INVESTMENT THEY'RE VERY
EASY WAYS TO DO THAT WITH WITH
POLICY ON TOP OF WHAT THE
ACTUAL SERVICES. WOULD
OTHERWISE ORDINARY. I DON'T I
DON'T KNOW BUT ANSWERS YOUR
QUESTION TO HOLD TOUCHED ALL
THE- OF. IT IT GETS ME TO TAKE
TO JUST TO FOLLOW UP THAT WAS
WHEN YOU SAID POLICY OULD.
ENCOURAGE WHAT SPECIFIC KIND OF
POLICY COULD THE STATE OF
CALIFORNIA DUE TO ENCOURAGE
THAT. AND I'M I'M NOT EXACTLY
SURE WHERE I HEAR BETTER SO
YOU'LL SEE ME MOVING BACK AND
FORTH AND I'LL JUST ADD ON TO
HIS GOOD QUESTION AND A LETTER
ANSWER BUT THANK YOU ASSEMBLY
MEMBER. JUST OR EVEN OUR OWN
ASSET LARGE ASSET OWNERS YOU
KNOW WE HAVE YOU KNOW CALPERS
AND CAL STIRS WHICH ARE OUR OWN
THAT'S PENSION FUNDS YOU KNOW-
YOU KNOW. WHAT CAN WE DO TO
BETTER ENCOURAGE THEM TO. THINK
YEAH YEAH- JUST JUST THERE AND
PENSION FUNDS- YOU KNOW.
SOMETHING THAT HAS OCCURRED
NOT. YET RECENTLY RECENTLY AND-
MOST PARTS OF THE WORLD WHERE
IT'S CONSIDERED PART OF YOUR
FIDUCIARY DUTY TO- TAKE THIS
ESG AND CONSIDERATION AS A
PENSION FUND TRUSTEE. SO BY
MAKING IT PART OF YOUR
FIDUCIARY DUTY WHAT DO YOU DO
EVERY PENSION FUND TRUSTEE NOW
IS SAYING I'M GOING TO TAKE A
LOOK AT MY PENSION FUNDS
CALPERS CASTERS EVERYBODY ELSE
AND SAYING. I HAVE TO LOOK AT
ESG OR ELSE I'M NOT DOING MY
DUTY- AS A AS A- PENSION FUNDS
YOU KNOW ASSET. MANAGER AND
OWNER- SO YOU KNOW THAT YOU CAN
REINFORCE THOSE NOTIONS THAT
IT'S JUST GOOD HYGIENE OR GOOD
PRACTICE AND THEN ALL OF A
SUDDEN AGAIN YOU'RE YOU'RE
PUSHING THAT AGENDA SO YOU CAN
DO IT. THROUGH SUBTLE NUDGES AS
I SAY YOU CAN DO IT THREE TAX
YOU CAN DO IT THROUGH-
PENALTIES- THAT THAT THERE ARE
THERE ARE SO MANY TOOLS I THINK
YOU HAVE AT YOUR DISPOSAL BUT
THAT'S THE OBVIOUS ONES ARE AS
I SAY NOT AS OR OR PENALTIES-
BUT- I. I TEND TO BE A BIG FAN
OF DRIVING BEHAVIOR CHANGE
THROUGH INCENTIVES RATHER THAN
DISINCENTIVES- I FIND
DISINCENTIVES ALWAYS HAVE SUCH
A NEGATIVE CONNOTATION THAT I
THINK ARE VERY UNPOPULAR WITH
LARGE SWATHS OF THE POPULATION
BECAUSE IT ALWAYS FEELS LIKE
YOU'RE GIVING SOMETHING UP.
ASSEMBLY CAN REDIRECT- MORE
TOWARDS THE PRESIDENT'S AN
INSIDE I THINK IT'S IT TENDS TO
BE BETTER ABLE TO BE DIGESTED
BY FIRE CONSTITUENCIES. AND I
THINK YOU HAVE TO TELL THE
OPPORTUNITY THE STORY- TO. THAT
IS SO MUCH A PART OF COURSE.
BECAUSE IN THE GAME WINNERS
LOSERS. JUST IN THE SHOW OF HI.
EMITTING INDUSTRIES TO GREENER
ENERGY THERE WILL BE THOSE WHO
ARE EMPLOYED IN THE HIGH CARBON
EMITTING INDUSTRIES THAT COULD
PERCEIVE THIS. AS A BIG LOSS
AND SO THEY MAY WANT TO FIGHT
THAT CHANGE. ON THE OTHER HAND
IF WE ARE AT THAT- AND SOMEBODY
REFERENCED AT THE KODAK
MOMENTS- WHETHER YOU FACE
DISRUPTION IF YOU DON'T CHANGE.
WHAT WE WOULD RATHER DO IS
PREPARE THOSE INDUSTRIES ARE
ULTIMATELY GOING TO FACE- THE-
MASSIVE VALUE LOSS. TO TRY TO
TRANSITION PEOPLE SOONER SO IT
DOESN'T COME AS A SHOCKER WE
DON'T HAVE STRANDED ASSETS OR
WASTED- YOU KNOW- HOPE
COMMUNITIES. BECAUSE THEY
HAVEN'T BEEN REALLY PUSH TO TRY
TO QUICKLY ADAPT TO ME IT'S ALL
ABOUT THIS THIS CLIMATE
ADAPTATION CLIMATE ADAPTATION
IS SEIZING THE MOMENT OF THE
OPPORTUNITY- SO ANOTHER AREA BY
THE WAY THAT WE DIDN'T TOUCH ON
IS I DON'T KNOW HOW MUCH THE
STATE. GETS INVOLVED IN ANY
TYPE OF SUBSIDIES. BUT
SUBSIDIES ARE A POWERFUL
INCENTIVE ALSO TO DRIVE CHANGE
WHO YOU'RE TALKING ABOUT
EARLIER ABOUT TAX. BUT YOU KNOW
IF WE EVEN READ DIRECT
SUBSIDIES AS THE BY THE STRANGE
SHE WAS TALKING ABOUT- TOWARDS
SAY THAT- FOSSIL FUELS
INDUSTRY. AND PUSH THOSE TOWARD
GREEN. YOU NEED TO SEE AGAIN
HOW QUICKLY THE CAPITAL FLOW TO
THOSE AREAS BECAUSE IT WILL BE
MORE ATTRACTIVE PLACES TO
INVEST. AND THE VALUE CREATION
OPPORTUNITIES THERE AN EQUAL
DOWNSIDE SIDE IS THAT IF YOU'RE
CONTINUING TO SAY INVEST IN
COMPANIES THAT WILL NO LONGER
BE RECIPIENTS OF SUBSIDIES. ARE
THOSE BUSINESSES STILL EVEN
VIABLE WITHOUT SUBSIDY. OR WILL
THE VALUE LAST BE SO GREAT THAT
YOU DON'T WANNA HOLD THOSE
ASSETS SO I THINK THAT AGAIN
THOSE ARE JUST A FEW SNIPPETS
OF IDEAS THAT YOU COULD DO- TO-
TO PROMOTE ALL OF THIS. I THINK
THE OTHER AREA BY THE WAY WHICH
DOESN'T EVEN REQUIRE ONE POLICY
INTERVENTION IS JUST BE VOCAL.
ABOUT. THE FACT THAT-
CALIFORNIA ENCOURAGE AGES. A
SUSTAINABLE. OR IS X. ABOUT
CREATE CALL SUPPORTING ALL
INDUSTRIES- THAT. TO WITH US
USING THE- AROUND. OR SOCIAL.
SO EVEN SOMETIMES JUST BEING
VERY CLEAR DIRECTIONALLY. ABOUT
WHERE THE STATE IS ON THESE
TOPICS IS VERY HELPFUL BECAUSE
WHEN INVESTORS GET CONFUSED
MESSAGES THAN THEY DO WORRY
ABOUT- POLICY INTERVENTION KIND
OF- SOMEHOW. CLEAR DURING THEIR
THEIR INVESTMENT DECISIONS AND
THAT'S COMING AS A SHOCK TO
THEM SO THEY WERE BEING VERY
VERY- CHRIS. AND THE DESIRE TO
TRY TO PUSH IN A GIVEN
DIRECTION THE EXTENT THAT YOU
POSSIBLY CAN- IS ANOTHER WAY TO
GIVE CONFIDENCE TO THE MARKETS
TO INVEST BEHIND THEM. ANYTHING
ELSE LOOSE THANK YOU SENATOR
ALAN. WHAT WELL FIRST OFF THANK
YOU TO THE CHAIRS FOR PUTTING
TOGETHER A REALLY FASCINATING
DISCUSSION THANK YOU MISTER-
APPRECIATE ALL YOUR- KNOWLEDGE
AND- INTERPRETERS AVACEN HERE
TODAY. YEAH I GOT SO MANY
QUESTIONS I AM. YOU'RE THE
STATE CALIFORNIA WE DID PASS A
BILL THAT- NASSER CAL STIRS
CALPERS TO LOOK IT. AT AT AT AT
RISK AND TAKING INTO ACCOUNT IS
THERE CLIMATE RELATED RISK
BECAUSE THEY'RE MAKING THEIR-INVESTMENT DECISIONS AND HE'S
BEEN A BIT OF IT. BACK AND
FORTH- OVER THERE AND- THAT
THAT THAT THERE'S SOME TENSIONS
INTERESTINGLY- BETWEEN THEIR
BOARD AND THE IMPLEMENTATION OF
THE BILL. BUT I'M- YOU KNOW I'M
'M I LIKE TO ASK A COUPLE
THINGS FIRST OF ALL DELIVER
THOUGHTS ON THE WHOLE DIVEST
MEANT DEBATE- I'M IN THE BACK
AND FORTH- YOU KNOW ON THAT-
THE EXTENT TO WHICH- YOU KNOW
IF YOU DIVEST YOU'RE- YOU'RE
PULLING YOURSELF. OBVIOUSLY YOU
YOU YOU DON'T WANT TO HAVE YOUR
MONEY GOING INTO. IMAGINED AND
ECONOMIC ACTIVITY DAMAGING
ACTIVITY AT THE SAME TIME WHEN
YOU WHEN YOU DIVEST. ONE OF THE
ARGUMENTS AS YOU PULL YOURSELF
OUT OF THE CONVERSATION ABOUT.
TRANSITIONING THESE COMPANIES
TOWARD A MORE SUSTAINABLE MODEL-
SO LET LET LET'S START WITH
THAT LOVE TO HEAR YOUR
CONVERSATION YOU'RE YOU'RE
THOUGHT. OF US IN THE SHORT. SO
I'M SPEAKING AS AN INDIVIDUAL
BUT I ALSO THINK
PHILOSOPHICALLY I. DO
REPRESENT- OUR OUR BELIEF IT AT
CREDIT SUISSE AS WELL IS THAT-
THE VESTMENT HAS A CERTAIN
PLACE. IN ALL OF THIS BUT
FRANKLY I THINK THE MORE
IMPORTANT TOOL THAT WE THINK OF
AS AS A BANK IS WE WOULD MUCH
RATHER FINANCE THE TRANSITION.
WE THINK THAT WE ARE NOT GOING
TO GET TO NEXT YEAR WE'RE NOT
GONNA BE ABLE TO KEEP WITHIN-
PARIS GOALS IF WE DON'T GET THE
HIGH CARBON EMITTING INDUSTRIES
TO MOVE. AND THAT IS NOT
SOMETHING THAT HAPPENS
OVERNIGHT TO THE QUESTION OF
THIS IS A LONGER TERM
INVESTMENT- VERSES OR SOMETHING
THAT CAN BE DONE IN THE SHORT
TERM. BUT WE DO NEED TO BE A
PART OF FINANCING THAT SO I
THINK WHAT I SAY AS WE KNOW
TODAY THE WORLD WAS RELIANT ON
FOSSIL FUELS WE SAID WE'RE
GOING TO DIVEST AND JUST CUT IT
OFF TOMORROW. WE WOULD CUT OFF
EVERYBODY FROM THE PRIMARY
SOURCE OF HEAT AND ELECTRICITY
AND ENERGY AND WE WOULD ALSO
CREATE A HIGHLY UNJUST OUTCOME
BECAUSE WE KNOW THAT THESE
TYPES OF ACTIONS
DISPROPORTIONATELY ALWAYS
AFFECT THOSE AT THE LOWER
ECONOMIC STRATA. BECAUSE THEY
TYPICALLY DON'T HAVE
ALTERNATIVES SO WE CAN'T DO
THAT WE'VE WE'VE GOT TO DO THIS
IN A IN A THOUGHTFUL AND
STANDS- MASATAKA WAY. SO WHAT I
WOULD. BUT SAY. IS IF WE DO.
HAVE H. GREEN. ALTERNATIVE
RIGHT A OPPORTUNITY AT PATHWAY
THAT'S TRULY GREED THERE I
THINK WE REALLY NEED TO DRIVE
WITH AS MUCH CARE AS THE STACK
BECAUSE IF YOU HAVE A SOLUTION
THAT IS TRULY VIABLE WE GOT TO
MOVE TO THAT WE HAVE TO MOVE
FAST THERE'S AN URGENCY HERE.
BUT IN AREAS WHERE- YOU HAVE A
VAST MAJORITY OF THE POPULATION
THAT IS RELIANCE ON THAT SOURCE
OF ENERGY AS AN EXAMPLE THEN
WE'RE GOING TO HAVE TO BRING
PEOPLE ALONG THE JOURNEY AND
THAT'S NOT ONLY JUST IN TERMS
OF THE COMPANY'S MINORING IN
BUSINESS PLANS IN OUR OWN RIGHT
BUT IT'S ALSO MAKING SURE WE
DON'T LEAVE PEOPLE BEHIND SO
IT'S A COMBINATION OF BOTH BUT
YOU'RE IS LIKE COAL WHICH
GENUINELY TODAY- DO NOT HAVE A
PLACE IN OUR SOCIETY THEY'RE SO
DESTRUCTIVE YOU HAVE BETTER
CHEAPER ALTERNATIVES. WE REALLY
OUT OF PUSH FOR NO MORE BUT
PLACES LIKE FOSSIL FUELS WE'RE
GOING TO HAVE TO HAVE THIS
MIGRATION BUT WE NEED TO
ACCELERATE THE TRANSITION WE'D
RATHER DO IS FUN WITH THESE
COMPANIES INTO BOTH INVESTING
IN THEIR BUSINESS BY MIGRATION
BUT ALSO INVESTING IN THE
TECHNOLOGIES IT'LL PROVIDE
PATHWAYS SOMETIMES TODAY DON'T
EVEN EXIST YOU KNOW THERE ARE
MANY INDUSTRIES AND HIGH CARBON
IN SPACE WHERE YOU ACTUALLY
DON'T HAVE TO AGREE AN
ALTERNATE YEAH. WE DON'T HAVE A
TRULY GREEN ALTERNATIVE FOR
AVIATION FUEL TODAY ALTHOUGH
THERE ARE SOME PROMISING
TECHNOLOGIES IN THE WORKS SO
IT'S A COMBINATION OF BOTH IS
MY ULTIMATE ANSWER BUT I DON'T
THINK THAT DIVESTMENT ALONE IS
GOING TO CHEAT THE OUTCOMES
THAT WE WANT TO GET COULD BE
CATASTROPHICALLY DETRIMENTAL TO
SOCIETY IN THE MEANTIME IF WE
ALL SET. TURN OFF THE TAPS
TOMORROW. WELL THE PROBLEM IT
THE- NEED SOME RESPECTS. OF
COURSE IF YOU HAVE. WERE TO OFF
THE TOP TOMORROW. BUT THE TRUTH
AS WE ALL KNOW. IS ONE. OF THE-
CAPITAL MARKETS THAT WOULD TURN
OFF THE TAPS AND IN FACT YOU
HAVE A ONE YOU HAVE OTHER.
PORTIONS OF. INVESTOR COMMUNITY
THAT MAKE A LOT OF MONEY OFF OF
THE FACT THAT. SO MANY PEOPLE
ARE PULLING OUT AND YET THERE
IS THIS THIS RELIANCE IN THE
COURSE OF THE FOLKS ARE MAKING
MONEY OFTENTIMES- YOU KNOW THE
BILL THE LEAST- SOCIALLY
INCLINED- YOU KNOW BECAUSE
THERE IS ANOTHER KIND OF FOLKS
THAT ARE MAKING A LOT OF MONEY
DOING MORE RESPONSIBLE
INVESTMENTS TO SELL OUT YOU
KNOW WHAT ONE OF THE THINGS
THAT DIFFERS FROM THIS IN THE
KODAK MOMENT IS THAT THE CODE
ACT FOLKS. I'M YOU WERE UNABLE
TO RESPOND TO. ADD TO CHANGES
IN THE MARKET. AND THAT WERE
LUCKY OF THEIR WORK THEY WERE
TECHNOLOGICAL AND- CONSUMER
BASED IN NATURE. OF WHAT WE'RE
TALKING ABOUT HERE IS. IS A IS
A MASSIVE GLOBAL POLICY. AND
POLITICAL PROBLEMS. AND THE
FACT THAT WHILE WE ALL
RECOGNIZE THAT WE HAVE TO WE
HAVE TO ACT THIS IS AN
EXISTENTIAL CRISIS FOR. MANKIND
FOR OUR PLANET- YOU KNOW
UNFORTUNATELY THERE WILL THERE
ARE IN THERE WILL CONTINUE TO
BE- NOT DENIERS AND
FREELOADERS. WHO ARE GONNA
CONTINUE TO DOUBLE DOWN AND
MAKE AS MUCH MONEY AS THEY
POSSIBLY CAN- AND- SO CAN YOU
TALK ABOUT THAT DYNAMIC AS WELL
I MEAN EVERYTHING YOU'RE
TALKING ABOUT A PRE SUPPOSES
THAT WE'RE GOING TO GET
TOGETHER AND DO THE RIGHT
THING. YEAH WE'RE SO DIVIDED
NOT ONLY AS A GLOW BUT AS A
NATION YOU HAD A YOU KNOW
FORMER PRESIDENT HE WOULD
LEARNING AROUND KHAN THE WHOLE
THING A HOAX. I'M SO. IT'S IT
IT IT DOES FEEL DIFFERENT THAN
KODAK FOR THAT REASON AND I'D
LOVE TO GET YOUR THOUGHTS ON
THAT. YES I MEAN I THINK. IF
YOU KNOW IF I REMEMBER MY CASE
STUDY CORRECTLY THOUGH KODAK
DID HAVE THE TECHNOLOGY FOR
DIGITAL FILM THEY JUST NEVER
SAW IT COMING BECAUSE THEY
DIDN'T HAVE THEY DIDN'T HAVE
THE APERTURE OF THE LENS TO
SUGGESTED THAT BUSINESS MODEL
LIKE IT DISRUPTED OUT EXISTENCE
IF THEY DIDN'T SEIZE THAT
MOMENT BUT- PUTTING THAT ASIDE
YOU KNOW WHO THIS IS ABSOLUTELY
VALID POINTS. THAT THERE WILL
BE PEOPLE THAT WILL OFFER
ARBITRAGE THE SYSTEM SO IF
CORPORATES ARE STARVED OF
CHEAPER LENDING CAPITAL THERE
WILL BE THOSE THAT WILL COME IN
AS THE LENDER OF LAST RESORT.
RESORT IN CHARGE USURIOUS RATES
BECAUSE THEY ARE THE LENDER OF
LAST RESORT ARE THE ONLY GAME
IN TOWN. HOWEVER FOR THOSE
COMPANIES AND TRYING TO ACCESS
THAT CAPITAL THAT'S GOING TO
GET INCREASINGLY MORE DIFFICULT
AND IT'LL BE EXPENSIVE. SO IT'S
GOING TO REALLY HIT THEIR
BOTTOM LINE SO IT IS A POWERFUL
TOOL TO USE YOU DON'T HAVE
ACCESS TO CAPITAL. AS AS SHALL
WE SAY AN INCENTIVE- TO MY
GREATER CHANGE AND WE CAN ALSO
SEE IT AND THAT'S JUST NOT DATA
RUNNING BATTLE. THE PRESSURE IS
ON THE EQUITY SIDE TO-
CERTAINLY I'M SURE YOU'RE WELL
AWARE JUST SUGGESTING. OF THE
ABSOLUTE AMOUNT OF EQUITY
VALUES THAT YOU KNOW EXXON'S
LOST OVER THE LAST SEVERAL
YEARS COMING OUT OF HERE THE
FORTUNE FIFTY FOR THE FIRST
TIME SINCE NINETEEN THIRTIES-
AND IT'S HUNDREDS AND HUNDREDS
OF BILLIONS OF CAPITAL- PARTLY
BECAUSE I THINK THE- EQUITY
COMMUNITY. DIDN'T SEE A CLEAR
ENOUGH WILLINGNESS OR CLIMATE
PLAN THAT WAS ARTICULATED TO
SAY THAT THEY ARE GOING TO BE
ON THE PROGRAM TO TRANSITION.
AND SO INVESTORS EVEN IN THE
FOSSIL FUELS INDUSTRY SAID. I'M
GOING TO MIGRATE THAT CAPITAL
TO THOSE WHO CAN ARTICULATE A
BETTER STORY WHICH I THINK IS
GOING TO BE LONGER TERM
SUSTAINABLE. AND I DON'T WANT
TO HOLD THE EQUITY OF PERHAPS
YOU KNOW COMPANIES THAT DON'T
ALIGN YOU KNOW WITH MY
CHRONICLES SO WHILE I DO THINK
THERE IS A MOMENT IN TIME WHERE
THOSE ONE ARBITRATION SYSTEM
CAN MAKE A LOT OF MONEY BECAUSE
THEY CAN CHARGE YOU KNOW.
THERE'S USERS RATES AT SOME I'M
POINT THEY WERE LEFT THEY'LL BE
HOLDING EMPTY BAG WENT AWAY
REALLY DOES. BECAUSE I THINK
IT'S HARD TO ENVISION A WORLD.
WHERE YOU IF YOU HAVE EVERY.
CRUNCH IN THE WORLD- ECONOMY IN
THE WORLD SAYING THAT THEY'RE
COMMITTING TO THAT ZERO- CHINA
INCLUDED SOME OF THOSE WHO HAVE
WORKED SOME OF THE BIGGEST.
NEWEST CARMEN BETTORS ARE
SAYING THEY'RE GOING TO GET
THERE AND I'M NOT SAYING THIS
WITHOUT IT'S COMPLICATIONS AND
THERE'S A LOT THAT THEY HAVE TO
WORK THROUGH IN TERMS OF
GETTING THINGS LIKE A LONG CALL
POLICY. BUT THEY MADE A PUBLIC
COMMITMENT TO GET THERE. AS WE
LEAD UP TO COST VIRTUALLY.
EVERY MAJOR NAME. LEAST ONE
VERY. IS NOW COMMITTING TO NET
ZERO AND I GENUINELY THINK THE
FINANCIAL COMMUNITY WILL HOLD
THEM TO ACCOUNT TO THEIR
STATEMENTS. I THINK
INCREASINGLY REGULATORS ARE
ALSO GONNA HOLD THEM TO
ACCOUNT. I E. EMPTY PROMISES
WITHOUT ACTUAL ACTION. IS NOT
GONNA BE SOMETHING THAT'S GOING
TO TOLERATE IT OVER TIME. SO
THAT GLOBAL MOVEMENT THAT'S
WHERE THE WORLD'S GOING THAT'S
WHERE THE CAPITAL IS GOING TO
BE INVESTED THAT'S WHERE THE
CONSUMERS WANT TO SEE THE
OUTCOMES THAT'S WHERE REGULARS
EVERYONE ELSE WE WANT TO GET
COMES AND IT'S JUST IT'S
EXISTENTIALISTS. I DO THINK
THERE IS GOING TO BE A SUNSET
PROVISION ON THOSE WHO WANT TO
SAY LET ME JUST SORT OF SHALL
WE SAY RIDE THIS AND SALES YOU
KNOW THE PARTIES OVER. WHAT
WHAT TOOL DO I REGULAR HAVE O
HOLD THE BIRDS. OR FOR EXAMPLE
AND COMPANIES IN THOSE
COUNTRIES ACCOUNTABLE TO THESE.
THESE GOALS AND PROMISES. I
DON'T THINK- AND I'M NOT EIGHT
GLOBAL ECONOMIST OR STRATEGIST
I DON'T I THINK IT'S VERY HARD
FOR A COUNTRY WHO IS ON THE
PATH TO HOLD ANOTHER COUNTRY TO
ACCOUNT- HOWEVER. YOU KNOW
THERE IS- I'D SAY YOU KNOW
GLOBAL PEER PRESSURE TOO LATE
TO GET THEIR NEXT YEAR LOOK AT
THE COMMITMENTS ARE HAPPENING
JUST JUST WATCH AS WE GET
CLOSER AND CLOSER TO COUGH AND
SEE HOW MANY MORE COUNTRIES YOU
KNOW JUMP ON. EVEN MORE- ED
SAFE RESTIVE COMMITMENTS TO GET
TO THAT ZERO I THINK THERE IS
THIS GLOBAL PRESSURE OF
COUNTRIES TO GO THERE. BUT I
ALSO THINK IF THE COUNTRY
LEADERS DON'T ARTICULATE THAT
THEY'LL BE A WHOLE HOST OF
OTHER INCENTIVES OR
DISINCENTIVES TO THOSE
COUNTRIES ON THE ONE HAND THE
COUNTRY THAT COMPANIES WITHIN
THOSE COUNTRIES- YOU KNOW I
THINK INCREASINGLY CAPITAL WILL
FLOW THERE IF THE COMPANIES
AREN'T. TAKING MATTERS INTO
THEIR OWN ACCOUNT BUT I ALSO
THINK CITIZENS ARE GOING TO
ULTIMATELY SAY NO MORE- THERE
ARE MODELS THAT WE'RE SEEING IN
COUNTRIES WHERE YOU'VE GOT
LEADERS WHO ARE SHOWING. REAL
PROGRESSION IN TERMS OF
SUSTAINABILITY AND THEY TEND TO
BE THE COUNTRY'S WHOSE-
POLITICAL LEADERS ARE
INCREASINGLY CAPTURING THE
HEARTS AND MINDS OF THEIR
CONSTITUENTS. AND AS CLIMATE
CHANGE BEGETS MORE AND MORE AND
MORE REAL FOR PEOPLE THAT THE
TOLERANCE LEVEL OF LIVING IN A
SOCIETY WITH HIGH POLLUTION
THIS IS PARTLY WHY I THINK YOU
KNOW CHINESE RESPOND AS THE
PEOPLE. YOU KNOW DON'T WANT TO
WAKE UP AND BARELY BE ABLE TO
READ THE ERROR OR HAVE YOU KNOW
YELLOW REVERSE OR WHATEVER YOU
KNOW THAT THAT'S NOT
SUSTAINABLE AS A POLITICAL
LEADER SO I ALSO THINK IN
SITUATIONS ARE GOING TO DEMAND
THAT OF THE READERS BUT THAT'S
GOING TO BE. YEAH THAT'S GONNA
TAKE SOME TIME I JUST DON'T
KNOW HOW YOU CAN REACH INTO
ANOTHER COUNTRY OTHER THAN
THROUGH PERSECUTION TO SAY YOU
MUST DO THIS. BUT I THINK. THE
FORCES AT WORK WILL GET US
THERE ANYMORE. HI MISTER I
PLEDGE WANT TO FOLLOW UP ON
YOUR EARLY. COMMENTS ON- THE
FIDUCIARY DUTY ELEMENT WHICH IS
SOMETHING I'VE NOT HEARD OF.
ANY EEN THE WHAT THE FIDUCIARY.
DUTY FOR ESP ACTORS AND YOU-
I'M JUST BECAUSE I KNOW VERY
ABOUT. THE E. U.'S CORPORATE
LAW- BUT- YOU KNOW IT'S I WHAT
ARE THE IN. MECHANISMS FOR THAT
IS A TYPICALLY RIGHT. IS IT
PRIVATE LAWSUIT TO THE THEY
HAVE A THAT FOR RULE THERE-
SORT OF HOW DOES THAT PRETTY
SURE YOU DO. IN JUST KIND OF
LIKE A LITTLE BIT OF A NOT YOU
SAID TO ENCOURAGE DIRECTORS AND
OFFICERS WHO ALREADY WANT TO.
INVEST IN CONSIDER THESE
FACTORS INTO DOING THE RIGHT
THING. YES THERE'S DIFFERENT
THERE ARE DIFFERENT ASPECTS OF
THIS- MANIFESTING IN DIFFERENT
PLACES BUT THE SUSTAINABLE
FINANCE DIRECTIVES S. SEVENTY
ARE WHICH IT WAS WHAT I WAS
REFERENCING EARLIER THAT CAME
INTO PLACE IN MARCH OF THIS
YEAR. IS A PIECE OF REGULATION
THAT'S GOVERNED BY THE E. U.
FOR ANY BANKS OR ASSET MANAGERS
WHICH OPERATED IN THE U. E. L.
THAT YOU HAVE TO DEMONSTRATE
THROUGH- DISCLOSURE THAT YOU'RE
TAKING AND MAKE A COMMITMENT OR
A STATEMENT. A TESTAMENT THAT
YOU ARE TAKING THESE INTO
CONSIDERATION SO THEY'RE USING
THAT AS A TOOL- BY VIRTUE OF
THEIR REGULATORY POWERS OVER
BANKS AND ASSET MANAGERS. ON
THE ONE HAND AND THEN THE
COMMON ABOUT THE JUDICIARY DUTY
SO THESE ARE TWO SEPARATE
ISSUES SO ONE IS YOU HAVE TO
DEMONSTRATE THAT YOU'RE TAKING
ESG INTO ACCOUNT- IN YOUR
FINANCIAL PRODUCTS AND ADVICE
THAT'S THROUGH THIS S. F. D. R.
REGULATION WHICH IS GETTING
EVER AND TODAY IT'S QUITE
GENERAL BUT THEY ARE GETTING
EVER MORE PRESCRIPTIVE SO AS AS
THIS SO IT JUST CAME INTO PLACE
AND MARCH. BY EARLY NEXT YEAR
THEY'RE GOING TO EVEN
PRESCRIBED IN A MUCH MORE
DETAILED WAY OF HOW THIS HAS TO
HAPPEN SO TODAY'S MORE GENERAL
DEMONSTRATIONS THAT YOU'VE DONE
IT BUT THEY'RE GETTING
INCREASINGLY MORE PRESCRIPTIVE.
THAN ON THE PENSION FUND SO
THIS IS THIS IS A FIDUCIARY
OBLIGATION AS A PENSION FUND
TRUSTEE IN SOME JURISDICTIONS
IS ACTUALLY IN THE LAW- THAT IS
PART OF YOUR FIDUCIARY DUTY AND
IN OTHER CASES IT'S CONSIDERED
WHAT'S BEST PRACTICE. AND SO IF
YOU'RE A TRUSTEE YOU LOOK TO
WHAT IS GUIDELINES AS BEST
PRACTICES SO SOMETIMES IT'S THE
SAME MANDATORY SOMETIMES IT'S
MORE OF A KNOWLEDGE SO IT IT'S
DIFFERENT IN DIFFERENT. PARTS
OF THE WORLD BUT I'D SAY THE
VAST MAJORITY OF- PENSION
REGULATIONS EITHER HAS THAT AS
AN AS A KNOWLEDGE AND A
GUIDELINE FOR ITS ACTUAL LAW IN
FACT THE U. S. WAS ONE OF THE
FEW MAJOR ECONOMIES WHERE. YOU
WENT THE OTHER WAY UNDER THE
LAST THIS SHE LED TO PROVE
TAKING. FACTORS DIFFERENT. DID
NOT RETURN. BUT THAT'S NOT BE.
NEVER THAT WILL BE REVERSED
WITH THE FINEST ALL THE SAME
SIGNALS AND SIGNS ARE THAT THEY
WILL FOLLOW SUIT WITH THE REST
OF THE WORLD. SO THE NUMBER IS
REQUESTED- I WAS JUST WANTIN
WHAT WAS SEEN FOR SPENT THOUGH
OF IT LIKE IF SOMEBODY DOESN'T
FOLLOW HAVE THERE BEEN ANY
EXAMPLES OF ENFORCEMENT ACTION
IS THERE EVIDENCE THAT. THIS IS
ACTUALLY CAUSING A CHANGE IN
BEHAVIOR FROM PENSION FUND
INVESTORS. WELL YES YES YES FOR
SURE- BECAUSE WE SEE IT IN. THE
AMOUNT OF PENSION FUND MONEY
THAT WANTS TO GET INVESTED IN
ESG STRATEGIES SO THIS BIG
GROWTH THAT WE'RE SEEING. IN
THE MARKETS IT IS NOT JUST
COMING FROM YOUR CLASSIC-
PRIVATE ASSET MANAGERS- BUT
IT'S ALSO COMING FROM THE
PENSION FUND INDUSTRY. PENSION
FUNDS ARE SAYING I MUST GET
INVESTED IN THESE ESG
STRATEGIES. SO YES IT'S
ABSOLUTELY CHANGING BEHAVIOR AS
PART OF THE DYNAMIC THAT'S
UNDERPINNING THE GROWTH RATES-
BUT WHAT DO REGULATORS ANY
REGULARS HAVE THE POWER AT
THEIR DISPOSAL. IF YOU WERE NOT
TO COMPLY- THEN YOU KNOW THEY
HAVE LOTS OF POWERS AT THEIR
DISPOSAL THEY COULD FIND YOU-
THEY COULD PROHIBIT YOU FROM
DOING CERTAIN TYPES OF BUSINESS
NOW A LOT OF THIS IS. NEW SO-
PARTICULAR SAYS FDR SO IT'S
ONLY ONLY JUST COMING MARCH SO
THERE ISN'T ENOUGH OF THAT
HISTORY THERE TO SAY FOR THOSE
WHO ARE COMPLYING. YOU KNOW
WHAT IS WHAT WHAT HAVE THEY
DONE IN TERMS OF THE- FOLLOWING
THROUGH ON THAT LEGISLATION.
BUT AGAIN WHEN YOU HAVE A
REGULAR TELLING YOU AS A
REGULATED ENTITY YOU MUST DO
THIS- THE ENTIRE FINANCIAL
COMMUNITY HAS RESPONDED ON
WE'VE ALL. WORKED IN OUR S. F.
E. R- DISCLOSURES THIS YEAR. SO
I'D SAY YOU KNOW I CAN'T THINK
OF A MAJOR INSTITUTION. THAT
HAS NOT COMPLIED. OKAY WELL
THANK YOU- I HAVE- WE WE'VE
WE'VE USED UP AN HOUR AND A
HALF OF OUR TIME AND WE REALLY
APPRECIATE IT WE WILL BE MOVING
TO PUBLIC COMMENTS IN A FEW
MINUTES BUT I DO HAVE ONE
QUESTION I'D LIKE TO ASK YOU-
IF I COULD AND IT MAY BE A
LITTLE BIT- PRESUMPTUOUS I
GUESS ON MY PART BUT TO IS
THERE ANY POSSIBILITY THAT THE
CALIFORNIA ASSEMBLY OR
POTENTIALLY CALIFORNIA
GOVERNMENT IF THERE WAS A-
CONVERGENCE OF IDEAS- COULD.
HAVE A PARTNERSHIP WITH CREDIT
SUISSE AND YOU AS WE WENT
THROUGH THE EXPLORATION OF THIS
DO YOU THINK THERE'S AND I AND
I KNOW WE'RE TALKING BIG
PICTURE BUT YOU THINK THERE'S
ANY INTEREST ON THE PART OF
CREDIT SUISSE IS THERE ANY
INTEREST ON THE PART OF YOU
PERSONALLY OF CREATING SOME
KIND OF INFORMAL OR FORMAL
PARTNERSHIP WITH THE STATE OF
CALIFORNIA OR THE ASSEMBLY OF
THE STATE OF CALIFORNIA- AS WE
TRY TO MANAGE IT YOU KNOW WE
HAVE. THE INTERESTING CHALLENGE
OF A HUNDRED AND TWENTY FORTY
SENATORS AND EIGHTY ASSEMBLY
MEMBERS TRYING TO. DEVELOPING
CRAFTED BILLS- AND YOU KNOW WE
CAN GET PASSIONATE ABOUT A BILL
AND I COULD SEE SOMEBODY
STARTING OFF ONE WAY AND
SUDDENLY. IT'S NOT GOING TO BE
A BILL THAT'S GOING TO BE
CONSISTENT WITH STANDARDS IN
OTHER PARTS OF THE WORLD AND-
IT SEEMS LIKE IF WE WERE ABLE
TO HAVE SOME KIND OF.
PARTNERSHIP WHERE WE COULD AT
LEAST. TAP YOUR EXPERTISE AND
SKILL OTHERWISE I SEE US TRYING
TO WITH OUR STAFFS AND OUR
COMMITTEES TRYING TO RESEARCH
AND- START FROM SCRATCH WHEN
YOU'RE ALREADY SO FAR AHEAD OF
US. COULD YOU COULD YOU COMMENT
ON THAT A LITTLE BIT JUST TELL
ME WHAT YOU'RE NOT ARE WHAT
WHAT. HELLO CERTAINLY I THINK
MY MISSION AND MY MANDATE IS TO
TRY TO HELP MOBILIZE CAPITAL
FOR FIVE THOUSAND OF OUR MAIL
SOCIAL OUTCOMES SO. AS PART OF
MY MANDATE VERY MUCH ON THE BIG
BELIEVER AND ACTUALLY TURNED
BACK TO THE SDGS. SDG SEVENTEEN
PARTNERSHIPS SO IT'S PART OF
OUR SCHOOLS WHAT WE DO IS WE
LOVE TO COLLABORATE LOVE TO.
YOU KNOW HELP- SHARE BEST
PRACTICE IDEAS WE DO HAVE A
PRIVILEGED POSITION THE SENSE
THAT YOU KNOW ISN'T WHAT WANTS
TO SHOULD WE GET TO SEE A LOT
OF THE ACTIVITY THAT'S
HAPPENING ACROSS THE WORLD BOTH
IN TERMS OF. YOU KNOW
REGULATORY DEVELOPMENTS BUT
ALSO THOSE OPPORTUNITIES THAT
WE TALKED ABOUT WHERE THOSE
POCKETS WHERE WE'RE SEEING AN
MAZING OPPORTUNITIES TO CREATE
VALUE. WITH PROMOTING NEW
INDUSTRIES WHETHER THEY BE THE
DISRUPTORS OR WHETHER IT BE
FASTER TRANSITION WHAT HAVE YOU
SO WE WOULD BE VERY VERY
DELIGHTED TO SHARE. YOU KNOW
WITH- WHERE WE CAN OUR
EXPERTISE AND OUR KNOWLEDGE-
AND WHAT WHATEVER THAT YOU KNOW
WHATEVER FORM THAT TAKES- YOU
KNOW OBVIOUSLY WITHIN REASON IN
TERMS OF OUR HUMAN CAPITAL BAND
WITH- SO I TO- IT'S EXPLORED
THIS IN IN WHATEVER CHANNEL
MAKES SOME SENSE SO. WE'VE
GOTTEN- MODES OF EXPERTS ON ON
MY TEAM THAT IT WOULD BE I
THINK VERY VERY PLEASED TO
ENGAGE WITH YOU AND YOUR
COLLEAGUES. THAT'S THAT'S
WONDERFUL TO HEAR AND- I DID
YEAH I JUST FEEL ENCOURAGED AS
WE HAVE. HAD GOOD INTEREST IN
THIS PRESENTATION TODAY AND I
THINK OUT OF THIS WILL COME-
MORE INTERESTED HOW CAN WE CAN
HOW CAN WE HARNESS- THIS WHOLE
PRIVATE SECTOR SIDE TO HELP. OF
CALIFORNIA STATE GOVERNMENT
TRYING TO MOVE US ALL ALONG-
I'M GETTING READY TO TURN IT TO
THE PUBLIC- ARE CHECKED WITH MR
GRAYSON ANYTHING ELSE BEFORE
WE- WE GO TO THE PUBLIC ALL
RIGHT. OF CHOI LIKE TO-
QUESTIONS FROM THE- AND YOU'LL
HAVE TO MANAGE- PER PERSON WE
HAVE- TEN MINUTES OUT. FOR
THIS- AND- WILL START HERE IN
THE CHAMBER I DON'T SEE ANYBODY
HERE THE CHAMBER ROOM FROM THE
PUBLIC- AND SO WE WILL GO- TO
THE- THE HEARING ROOM- ARE
THERE ANY MEMBERS- FOR REMOTE
TESTIMONY FROM THE HEARING ROOM
AND I DON'T BELIEVE THERE ARE
ANY. CORRECT AND- THEN THE
AMERICAN. NOBODY FROM THE
REMOTE TESTIMONY IS THERE
ANYBODY ON THE PHONE- THAT HAS
QUESTIONS WOULD LIKE TO
IDENTIFY THEMSELVES AND AGAIN
WE INVITED YOU TO CALL IN- AND
THAT WAS. EIGHT SEVEN SEVEN SIX
NINE TWO EIGHT NINE FIVE SEVEN.
AND THEN USE THE ACCESS CODE.
TWENTY FOUR TWENTY SIX TO
THIRTY SEVEN SO I'LL REPEAT
THAT ONE MORE TIME SO THE PHONE
NUMBER IS EIGHT SEVEN SEVEN.
SIX NINE TWO EIGHT NINE FIVE
SEVEN. AN ACCESS CODE IS. TWO
FOUR TWO SIX TWO THREE SEVEN.
OPERATOR DO WE HAVE ANYBODY ON
THE LINE. THANK YOU I CURRENTLY
HAVE NO PUBLIC LINE'S DIALED IN
OVER THE PHONE AT THIS TIME.
OKAY WE'LL WAIT JUST A FEW
MOMENTS AND- SEE IF WE HAVE
ANYBODY AND. OPERATOR OF THE
LINE STILL LARA STILL CLIP
EMPTY. I STILL HAVE NO WENT OUT
AND CURRENTLY ALL RIGHT THANK
YOU VERY MUCH WE HAVE TO BY LAW
TO CREATE THAT OPPORTUNITY I
HAVE- ONE OR TWO QUICK FINAL
QUESTION FOR YOU AND- BEFORE WE
END THIS AND SO CALIFORNIA
COULD ISSUE GREEN BONDS AND I
NOTICED THAT AMAZON ISSUED A
BILLION DOLLAR GREEN BOND
TODAY. EARLIER YOU TALKED ABOUT
IN ASIA FUND AND YOU SAID THEY
ISSUED FIVE HUNDRED MILLION AND
I THOUGHT OF DID YOU MEAN FIVE
HUNDRED MILLION. SO YES- SO
AMAZON I CAN QUICKLY COMMENT-
WHICH I THINK IS A WONDERFUL
EXAMPLE OF A COMPANY THAT'S
ISSUED ITS OWN SUSTAINABILITY.
BONDS AND THIS TOPIC THAT WE
SAID ABOUT THE SUPPLY DEMAND
EQUATION IN TERMS OF THEIR ESG
OR SUSTAINABLE INVESTORS-
REALLY REALLY WANTED BUT MORE
MORE CAPITAL TO WORK BEHIND
COMPANIES TO ARE GENUINELY
TRYING TO- TO INVEST FOR
POSITIVE OUTCOMES. SO THAT THE
TRANSACTION AT AMAZON DID IT
WAS EIGHTEEN AND A HALF BILLION
U. S. DOLLARS ISSUANCE OF MANY
DIFFERENT TRANCHES SO THEY
WEREN'T ALSO STAND UP ALL. BUT
IT HAD A TWO YEAR TRUNCHEON THE
BILLION U. S. DOLLARS WHICH WAS
SPECIFICALLY EARMARKED TO BE A
SUSTAINABILITY TRONG CHI. SO
THEY RAISE THAT CAPITAL AND
WHAT THEY'VE COMMITTED TO DO IS
INVEST THAT IN THINGS LIKE
ELECTRIFICATION. OF THEIR
TRUCKS AND THEIR DELIVERY
VEHICLES THEY HAVE SAID THAT
THEY WILL INVEST IN- TRYING TO
TRANSITION THE SOURCES OF
ENERGY IN THEIR FACILITIES TO
MAKE IT ALL ABOUT GREEN ENERGY-
THERE ALSO- SAID THEY WILL
INVEST A PORTION OF THOSE
PROCEEDS AND UPSKILLING THEIR
WORKERS BACK TO THE S. OR THE
S. IN THE E. ARE INTERTWINED
HERE. AND SO ON AND THAT TRONG
SHE WAS. HEAVILY HEAVILY
OVERSUBSCRIBED BY ESG INVESTORS
AND IT IS AT THE LOWEST-
COUPON. LOWEST COST OF CAPITAL
HI MONTHS ONLY FOR COMPANIES IN
THE WORLD OF EFFORT ISSUES AT
THIS LOW OF A RATE AN ABSOLUTE
RATE IN HISTORY SO IT WAS
TWENTY BASIS POINTS OVER
TREASURYS- OR SORRY TEN WITH
BASIS POINTS OVER TREASURYS. SO
BACK TO THE IDEA THAT IT'S A
WIN WIN FOR EVERYBODY SO THE
ISSUERS CAN ACCESS DEDICATED
POOLS OF CAPITAL FROM THESE
COMMITTED ESG INVESTORS AT VERY-ATTRACTIVE RATES. THE COMPANIES
THEMSELVES CAN ISSUED TO INVEST
THAT MONEY AND POSITIVE
OUTCOMES THAT CAN BOTH HELP
MITIGATE CLIMATE CHANGE
OBVIOUSLY GOOD FOR ALL OF US
BUT ALSO HELP ON THE SOCIAL.
SIDE WITH THEIR OWN EMPLOYEES
SO I THINK IT'S AN- AND- OF
BEING- COMPREHEND. AND THINKING
OF WHAT'S IT CAN MEAN FROM THE
BEST MASSAGE AND MAYBE HEALTH
COULD DO. YOU. ISSUE YOUR OWN
GREENER OR BY. AND PICK THE
AREA THAT YOU ARE IMPORTANT-
WHERE YOU WANTED PLAY CATCH.
IT'S WAY JUST LIKE ANY ON IS
NOT LIMITED TO CORPORATE. SO SO
HOPEFULLY THAT'S LIKE A- A
LITTLE INCENTIVE. TO SORT OF
THINK HOLISTICALLY AND BROUGHT.
ABOUT THIS- STAND TOP AND THEN
SECONDOF YOUR I WAS MY TRIP
RIGHT. YOU SEE THE SECOND PART
OF MICHAEL. YEAH I SAID I WAS
ON IT WAS. AND I'VE YOU I THINK
YOU INTERNET WAS ASKING ABOUT
OKAY YOU KNOW WHAT WHAT DID MS
DO THAT MY FOLLOW UP TO THAT SO
THE STATE OF CALIFORNIA. COULD
ISSUED GREEN BONDS AND GET VERY
ATTRACTIVE INTEREST RATES ON
THOSE IN THE CURRENT CLIMATE AT
LEAST- IF AS LONG AS THEY
IDENTIFIED THAT THOSE PROCEEDS
ARE GOING TO BE USED
SPECIFICALLY FOR. THESE
APPROACH GREEN INVESTMENTS OR
FOR OR JUST TRANSITION SUCH AS
MUCH RIGHT TO COULD BE
ESCALATED SIGNIFICANT WAY TO-
TO DECREASE OUR COST OF
CAPITAL- FOR THOSE KINDS OF
BONDS AS YOU GO FOR. NOW WHAT
WHAT COMES TO MY- IS.
CONSTANTLY WE SEE IT IN L. A.
N. IN THE WORLD PEOPLE FIND
WAYS TO MANIPULATE WHATEVER
SITUATION IS OUT THERE- I SEE
RIGHT IN I CAN IMAGINE RIGHT
NOW WITH THINGS BEING OVER SO.
INTEREST RATES ARE VERY LOW AT
THIS POINT TIME I WOULD IMAGINE
WE WILL HAVE JUST AS YOU
POINTED OUT THERE ARE PEOPLE
THAT ARE GOING TO ARBITRAGE AND
PEOPLE ARE GOING TO. TRY TO
MANIPULATE THE SYSTEM THAT
THERE WILL BE PEOPLE TRYING TO
DO THAT IDENTIFYING THAT THIS
IS A GREEN BOND WHEN IT'S YOU
KNOW OUR IS IT REALLY GOING TO
BE THAT AND SO THAT'S WHERE
THE- THAT'S WHERE THE STANDARD
ACCOUNTABILITY PRACTICES COME
IN AND THE PROPER DEFINITIONS
COMEY AND- PICK CENTER I
ASSUME. TERMS OF YOU KNOW HOW
DO WE ENFORCE THAT AND HOW DO
WE- DEVELOP DATA AS IT MOVES
TOWARD A CERTAIN PRACTICES.
THAT'S THAT VERY MUCH SO YES I
DO SO- THERE IS A STANDARD IN
THE MARKET- FOR WHAT IS DEFINED
AS GREEN- FROM WHEN WE'RE
TALKING ABOUT THIS ACCESSING
THE DEBT CAPITAL MARKETS. SO
TODAY WE HAVE FRAMEWORKS AND
THEY'RE QUITE RIGOROUS AND
TYPICALLY ISSUERS OF GREEN OR
SOCIAL BONDS WILL HAVE A THIRD
PARTY INSURANCE PROVIDER THAT
LOOKS AT THE USE OF PROCEEDS
AND SAYS YES THIS DOES COMPLY
WITH WHAT MARKET STANDARD IS.
AND WHEN THAT IS THAN THE LAST
BY FOLLOWING THOSE FRAMEWORKS
THEN THOSE SECURITIES CAN BE
PART OF THE GREEN BOND INDICES
AND THAT IS A VERY IMPORTANT TO
BOTH FROM THE AFTER MARKET
TRADING POINT OF VIEW BUT ALSO
IN TERMS OF. THE ISSUE IS
FUTURE ACCESS TO GREEN CAPITAL
SO- THAT'S ACTUALLY QUITE A-
WELL DEFINED AND NOW REASONABLY
MATURE PROCESS AND THAT'LL THAT
I THINK- IS AND SHALL WE SAY
KEEPS THE ISSUE AS HONEST. AND
AVOID GREENWASHING SO SOME OF
THESE STANDARDS THAT ARE. BEING
CREATED AS AS THESE MARKETS
MATURE ARE HELPING TO CREATE
INTEGRITY TO THE MARKETS AND
GIVE CONFIDENCE INVESTMENT
COMMUNITY BUT- I FEEL VERY
COMFORTABLE WITH YOU KNOW WHAT
IS DEFINED AS GREEN WITHIN THE.
I REQUEST YOU HAVE GIVEN US AN
ENORMOUS AMOUNT OF- POSITIVE
ENERGY AND THINGS TO THINK
ABOUT- FOR THE LEGISLATURE BOTH
THE ASSEMBLY AND THE SENATE. WE
REALLY APPRECIATE- THE GENUINE
SPIRIT OF- COLLABORATION AND
COOPERATION THAT YOU'VE YOU'VE
DEMONSTRATED NOT JUST TODAY BUT
IN OUR CONVERSATIONS BEFORE TO
GET THIS SET UP SO I WANT TO
SAY THANK YOU VERY MUCH- IT
MEANS. A LOT TO ME PERSONALLY
IT MEANS A LOT TO- ALL OF US
HERE IN CALIFORNIA- TO BE ABLE
TO PARTNER WITH- PEOPLE LIKE
YOURSELF WHO ARE. REALLY TRYING
TO MAKE A REAL DIFFERENCE- FROM
THE WORLD- AS WE GO FORWARD SO-
WITH THAT- SURE GO OVER- MISTER
GRATION IS FINE AND- WE WILL
LET YOU- ESCAPE A LITTLE BIT
EARLY AND NOT KNOW WHAT'S AND
LATE EVENING FOR YOU THERE IN
CONNECTICUT SO- THANK YOU VERY
MUCH FOR US TO DREW- THE- I'M
SO. PLEASURE AND BUT I THINK
YOU JUST HAVE YOU SO MUCH I.
YOU KNOW WHAT I THINK ABOUT THE
THAT. KNOWN YOUR- CAN THERE'S A
HUGE. FOR TO CAN TO FIGHT EVER
SYSTEM- THERE'S SO MUCH. AT
WORK THAT CAN BE APPLIED TO OF
YOUR- YOU KNOW- IN IN. INDUSTRY
SECTOR TECH ITSELF ITS OWN YOU.
THE GREENTECH METER ON WORLD
YOU AT EVERY LEAD. OPPORTUNITY
TO JUST THAT NO AND I.
INVESTING BILLIONS INTO TECH TO
AS PART OF THIS NEXT YEAR COME
IN. YOU KNOW UP CALLOUS FOR
ALWAYS LEADERS AND OF ITS A-
APOLLO. GENERALLY ANYTHING
BECAUSE I'M- HERE. WITH. THEN
HOPEFULLY YOU CAPTURED THE
HEARTS AND MINDS OF. YOUR
POPULOUS AND THEN EVERYBODY IS
SUPPORTIVE OF THIS AGENDA SO I
WILL LEAVE YOU WITH THAT. EVERY
EVERY TIME YOU UP WITH THAT WAS
A GREAT IDEA FOR CALIFORNIA
DON'T HESITATE TO CONTACT US
AFTER ANY. I WILL DO THANK YOU
VERY MUCH HAVE A GOOD DAY. I
THANK YOU BYE BYE THIS MEETING
IS ADJOURNED. THANK YOU.